Losing a job when in an IVA IVA Issue
Summary: This article seeks to explain the implications for someone losing their job whilst in an IVA (Individual Voluntary Arrangement).
Don't panic
No one can ever be certain of what will happen in the future. When you entered into the IVA, it was on the basis of what was known at the time. Unfortunately sometimes things don't go as planned and your circumstances can change for the worse -and sometimes for the better!
If you are made redundant for example, or change jobs and your income is lower, it will have an impact on your ability to repay your monthly IVA payments. Given that we live in uncertain times, very few jobs are absolutely secure.
Inform someone
If you believe that you about to lose your job or have lost your job then it is essential that you let the Supervisor of your IVA know as soon as possible and explain why the payment will be delayed and when it can be expected to be paid. If you have actually lost your then you will need to consider how soon you will back in employment. Most IVA proposals will allow you a short payment break to find a new job.
Variation Meeting
If you've lost your job and think it will difficult to find a new one then a variation meeting will need to be arranged to consult with the creditors. At the meeting a longer payment break can be requested on the basis that the payments are made up at the end of the IVA. This will mean increasing the length of the IVA by several months.
Change of salary
It's in everyone's interests for your IVA to succeed, so as long as you keep your supervisor informed, it is likely you will be given realistic opportunity to find a new job. Of course the job you find is likely to be on a different salary level. Changes of income will need to be communicated as in the IVA you are responsible for paying all you can afford. Along with changing income may come changes of outgoings - travel costs, childcare etc. The new IVA payment level will need to be established.
Long term unemployment
Unfortunately for some, the prospects of finding a new job appear to be remote. There comes a point at which the IVA will have to fail because payments having been suspended for a while show no signs of starting again. At this point you will need to take advice from your IVA supervisor. The likely solutions are either bankruptcy or making token payments to your creditors.