How can I clear my IVA?

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ilx_smithy123
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by ilx_smithy123 » Sun Sep 30, 2018 9:18 pm
Hello, I started an IVA in October 2016 (2 Years) I had around £13,000 in debt and currently paid £6500 over the 2 years, I did 3 months of £202, 10 Months of £276 and currently on £312pm for the past 10 Months. I have recently been reading up about increasing my payments to £500 a month to pay off the IVA quicker and within 1 year but I had seen that if I increased the payments I would still be expected to pay until the 5 year point to which I would have to pay over £11,000 extra. I have also got a new job which I get paid over £500 more per month more which allows me to increase the payments, I have been saving every penny I can so I currently have over £4000 saved. Could someone tell me what I should do and wether its true about having to still pay until the 5 year point. how much would you think I would need, to pay a lump some to finish the IVA. Thank you hope to hear back from you. Kind regards Luke
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luluj
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by luluj » Sun Sep 30, 2018 9:33 pm
Your IVA will remaim on file until 2022 whether you clear via a full and final now or continue with payments each month. You will always owe the full debt amounts prior to the iva. Your iva will only finish early if you pay your full amount of debt plus IP fees and statutory interest.

As your salary has increased by £500/mth your income and expenditure should be reviewed and adjusted by your IP.

Having been able to save £4000 whilst in an iva indicates to me that your I&E definitely needs to.be reviewed fully.

Let us know how you get on.
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Foggy
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by Foggy » Mon Oct 01, 2018 6:50 am
With increased payments you will continue paying until you hit the sum of the full original debt, plus fees and statutory interest, or you come to the agreed end of the term, whichever happens first.

Any increase in wages you have had and overtime, bonus payments etc. should have been declared to the IP and around half paid into the IVA. As Luluj says, that level of savings indicates that, either the rises, extra income has been in the region of £8k, or you haven't declared it.
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Lisa Thomas
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by Lisa Thomas » Mon Oct 01, 2018 9:01 am
Once your I&E has been reviewed you will have a new monthly (?) figure to pay over. You can then multiply the new payment by the no. of payments left and this will give you your starting figure against which to make any full and final offer.

They will want to see where the savings of £4k have come from. If it's from your share of overtime/bonuses etc this will be fine but if it's from a second income you haven't yet disclosed to your IP you may well have to pay this over anyway.

Watch my quick video here on F&F's for more info:

https://youtu.be/h4dozq9aGak
ilx_smithy123
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by ilx_smithy123 » Wed Oct 17, 2018 6:04 pm
Hello, I currently have £5000 Saved as I left the military and went into a new job with a big increase in monthly wages so I've been able to save more, I contacted the IVA Company and they said I can offer a final settlement fee but they haven't got back in touch with me. I know I shouldn't be saving but I've been able to save to the total of remaining debt which I owe. Would this amount of £6000 be enough for a final settlement or would I need more than this and whats the possibilities they will accept it. I have been budgeting and been able to live without spending for the last few months as I've been living with parents so that after the IVA I can start saving for a House, anyways hope you can provide with more information, Thank you
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Foggy
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by Foggy » Wed Oct 17, 2018 6:48 pm
So ... you have 3 years left and pay £312 per month -- is this right ? So your creditors are expecting you to pay in another £11,232

They will be looking at more if you advise the wage increases as you are supposed to do ....... Have you been telling your IP about extra income so far and paying in the IVA share (about half ) ?

Have you also advised them that you haven't been paying rent (which is probably being allowed for in your agreed outgoings) ?

A debt of £13,000 would need something like £19,000 to fully settle at the moment, you have already paid in £6,500 ... so another £12,500 would be required to settle fully -- given this, it will take the 5 years to hit the full repayment figure.

So ... options are to "settle" ---- pay them another £12.5k, make a F&F offer ---- probably around £9k would be looked at seriously, or carry on as you are. In each case your credit files will still be shot until 2022.

N.B This is all assuming that you have been up front and have declared increases in income and decreases in expenditure and paid the agreed extra into the IVA
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Lisa Thomas
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by Lisa Thomas » Thu Oct 18, 2018 9:39 am
I agree with Foggy's advice and am interested to know if you declared this extra income to your IP - has it come from your share of the 10/50/50 rule? (i.e did you pay some of your overtime/bonuses etc over to the IP and they agreed you could keep some?)
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