Options for a friend??

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abbiesmum2003
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by abbiesmum2003 » Sat Nov 10, 2018 12:55 pm
My friend is a single parent of 3 children (10,8 and newborn).
She is about half way through an iva paying £170 a month.
She lives in council accomodation. She works full time but currently is on mat leave.
I have been looking into her budget as got arrears with electric and had them round to change her onto a meter. She had rent arrears with the council.
She is in a pickle and I want to help.
I have used expenditure allowances to get an idea of spending, plus her rent costs, childcare costs and bills and it would appear she has absolutely no disposable income.
She hasnt told them about mat leave yet and income will fall then childcare will go up next summer when back at work.
There has got to be a different solution for her to get out of this.
We were in a better financial position during our iva. She still lives day to day not knowing where shopping fuel and electric will comw from.
Any suggeations?? I know what I think but want your knowledgable help
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Foggy
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by Foggy » Sat Nov 10, 2018 1:14 pm
For a start, either her I&E is adrift or her spending isn't as well controlled as she would like it to be. She should have told the IP and, maybe agreed a short break during mat. leave, which could help her catch up -- but that I&E will need to be revisited anyway, as things have drastically changed.

Were it me I would first try to get a reduction in payment, but, if the I&E showed that the IVA was, indeed, not viable (no D.I., or very little), try to get the IVA completed by making a F&F based on payments made to date (assuming any sort of lump sum was not on the table), if this was refused, look at failing the IVA and doing a DRO if all the citeria was met for that. CAB can put her in touch with a DRO intermediary.
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abbiesmum2003
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by abbiesmum2003 » Sat Nov 10, 2018 1:30 pm
Thanks foggy
Spending isnt adrift. I see her alot amd they dont have anything special or exceptional.
It went awol when benefits changed to universal credit. She has struggled for a long time but has just admitted burying head in sand!!! Not helpful!!!!
The baby was not planned at all and we discussed the implications if continued pregancy....for personal reasons she continued the pregnancy.
I dont think she can have a DRO as one of the criteria is cant already have had an IVA.

Shes considered declaring self bankrupt by stoppig paying iva to save up the fee.
Wouls that be a solution or do you think asking payments to date be better?
How would she broach that with iva company?
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Foggy
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by Foggy » Sat Nov 10, 2018 2:02 pm
As long as the IVA has been terminated she can apply for a DRO (assuming other criteria met) . Have a read here: https://debtcamel.co.uk/end-iva-change-to-dro/
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kallis3
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by kallis3 » Sat Nov 10, 2018 2:51 pm
I agree with Foggy - seek further advice as a DRO might be an idea.
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luluj
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by luluj » Sun Nov 11, 2018 2:12 am
What a great friend to have- someone who knows what its like to go through.

I agree a DRO may be an option, but I do like you wonder if bankruptcy would be a better and quicker option with the position she is in.

I would ask her to seek a reassessment of her universal credit if it has changed things dramatically - UC should be helping not hindering the situation, particularly with her family status.
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abbiesmum2003
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by abbiesmum2003 » Sun Nov 11, 2018 8:50 am
Thank you lulu
Yes it was a relief for both of us to find out we were in similar situation.
She was telling me about a year or more ago about her debts and couldnt afford xyz.
I broached the idea of an iva and thats when she said she was alrrady in one.
I could have cried. We were in a better position than before an iva and she was still struggling.
She has sent me her I&E and Ive found an example allowances form to give suggested values for the things you may not think about. Bills are not what she actually pays.
Her I&E shows a figure of DI on it after but her IVA payment is more than this DI figure!
Its no wonder shes in a pickle!
I like Foggys idea of discussing 'payments made to date' but definately needs to review the I&E with the chamge in circumstamces.
I dont know what company she is with...will ask today.
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Lisa Thomas
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by Lisa Thomas » Mon Nov 12, 2018 1:24 pm
Options to consider:

1. Speak to her IP and see if she can propose variation to creditors to accept payments to date in full and final and close IVA early
2. Failure of IVA and potentially Bankrupted by IVA Supervisor (depending on terms) or she is back to square one.
3 Depending on the above she enters a DRO or Bankruptcy.

Do you know why she decided to do an IVA instead of Bankruptcy initially?
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