Can we request early settlement of IVA?

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annieA

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Post by annieA » Mon Dec 21, 2020 5:16 pm
Hi there,

Me and my partner entered an IVA back in 2016. We are due to finish by September 2021. Our total debt was £8583.59, however, our agreement was to pay £70 for 60 months (a total of £4200).

Along the way we had some increases in these payments, meaning that we have now payed £4500 during these 4 years with 1 more year to go.

We have had several issues with the company with income and expenditure forms where they omitted certain bills on our expenditure (e.g. gas, electricity), making it seem we have more money left over than what we actually do. I just wanted to get this over and done with asap to be honest.

My question is: are we allowed to request our account to be settled at this current stage without any extra payments? As you can see we have now payed pretty much 50% of our total debt. Also, I am currently unemployed and studying full time, and we also have an 1 year old who is not in nursery meaning I am for the meantime unable to return to work. I will be finishing my masters degree in September 2021 (our final IVA payment is in August), meaning that it will be hard for us to keep up with the payments in this final year.

Does this seem like something we would be able to get accepted for?

Thank you

Foggy

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Post by Foggy » Mon Dec 21, 2020 5:53 pm
I would think it unlikely for creditors to accept ending early without good reason. Those reasons would be looked at in the light of why and when did you lose your job? When did you start the current course of study ? If and when the IVA becomes unaffordable, you could ask .... but, be aware, the creditors are not obliged to accept and could simply fail the arrangement if you say you cannot continue paying.

£70 a month is about the lowest payment you can make whilst keeping the IVA viable and, I imagine, your provider has been omitting expenses to keep it looking that you can afford this payment --- the alternative being, as above, asking the creditors to accept payments made to date, which, to be fair, is a possibility as they have had what they signed up for. But, there is still that risk ........

I am afraid that you have not paid anywhere near 50% of the debt. After fees etc, I suspect the amount your creditors have got would be in the region of £2k. But, as mentioned already, this is what they signed up for.

I would say it would be a gamble.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk

annieA

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Joined: Mon Dec 21, 2020 5:08 pm

Post by annieA » Mon Dec 21, 2020 7:00 pm
Thank you for your response!

What I meant by them omitting expenses was that, for example, last year they left out our gas and electric expenses and put us on £192 a month. They did not even told us that they omitted anything, I was the one to spot it. Bear in mind that even if they had added this, we could still make a £70 a month payment. They could have also ask us to try to reduce some payments on things like hairdressing for example, which are less important. However, they didn't do none of this.

I have recently sent our annual review with a new income and expenditure form where I show we can only afford £70 a month this final year. However, they told my partner today they had a look at it and that we have £400 leftover so this is what we are meant to pay?...The people who deal with the review are on holiday so we cannot get this sorted. My partner payed only £70 and was told this means we would not be keeping with the requested payment. I do not know where they got the £400 figure from as I did the form myself. I suspect they once again omitted things from our expenditure to imply we have more money.

Also, they said there was an income increase in January hence this higer payment (I am guessing this is related to the need to pay 50% of any increase in wages). However, this is untrue. There was no increase whatsoever this year. In fact, I changed jobs in March where I was paying about £100 less per month. Then in July my job ended (my contract was only until July). I started uni in September. I have informed them if all this when I sent the forms back in October.

I just feel like they are making things up to 'milk' more money when we do not have anything extra to give! I can keep up with £70 a month without them omitting things as obviously I try to keep my expenses as low as possible to enable us to keep on making viable payments.

I read on here some people make a full and final payment to close their account earlier than they reach 5 years and they base the sum needed on whatever they were still meant to pay should the IVA run its full course. So, since we have now payed more than the full amount expected for the 5 years, is it not realistic to think they might allow us to close the account now?

Thank you once again!

Foggy

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Post by Foggy » Mon Dec 21, 2020 7:33 pm
Regarding the second from last paragraph -- the amount of a full and final offer is based on the amount of remaining payments, regardless of anything paid previously. Thereby matching whatever the creditors are still expecting to be paid.

On the botched I&E front, your only options are to make a formal complaint, demanding a full explanation of where they have got this increase in income from as well as why the figures they use do not match those you provide, in writing, to your IP, which you can then escalate to their regulatory body, via the government complaints gateway, should you need to. The RB will not actually intervene but can, if they find in your favour, fine the IP (sometimes with an eye watering fine) and the threat of this often makes them re-think.

Have a look here: https://www.gov.uk/government/publicati ... actitioner

The complaints Gateway is here: https://www.gov.uk/complain-about-insol ... actitioner
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk

annieA

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Joined: Mon Dec 21, 2020 5:08 pm

Post by annieA » Tue Dec 22, 2020 12:55 pm
Hi there,

Me and my partner entered an IVA back in 2016, due to finish by September 2021. Our original debt was £8583.59, and our agreement was for £70 payments to be done during 60 months (a total of £4200).

During these 4 years we had some payment increases meaning that we have now payed £4500 over these 4 years with 1 to go. My question is: are we able to request for our account to be settled at this point without any further payments?

The reason for this is that we have had lots of issues with the company who keep making mistakes with our income and expenditure forms. At one point they omitted our Gas and Eletric monthly cost, making it seem we had more money leftover than we actually did. I just wanted to get this over and done with asap.

Also, I am currently unemployed and studying full time, and also have a 1 year old who is not in nursery, meaning that I am unable to return to work. I will be finishing my Masters in September, and by then our IVA would have ended. Because of this, keeping up with our payments will be difficult during this final year.

Also, as we have now payed around 50% of our original debt, and more than we had originally agreed with, we were hoping to be able to settle this earlier.

Does this sound like something we would be likely to be accepted for?

Thank you

kallis3

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Post by kallis3 » Tue Dec 22, 2020 1:24 pm
Topics merged to avoid confusion.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley.
http://kallis3.blogs.iva.co.uk
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