Paying off last year of IVA?

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joanne905
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by joanne905 » Tue Jul 31, 2018 5:34 am
Partner has IVA and has about 1 yr left to pay. He is been made redundant so looking into it we believe they can take most of this and still make him finish his next 11/12 payments. Would it be possible for me to get a credit card and pay off his next yrs paymentsas a one off payment then when he gets his redundancy he can pay off my card. Would this totally clear thw debt and leave him with most of his redundancy
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Foggy
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by Foggy » Tue Jul 31, 2018 8:27 am
joanne905 wrote:
Partner has IVA and has about 1 yr left to pay. He is been made redundant so looking into it we believe they can take most of this and still make him finish his next 11/12 payments. Would it be possible for me to get a credit card and pay off his next yrs paymentsas a one off payment then when he gets his redundancy he can pay off my card. Would this totally clear thw debt and leave him with most of his redundancy


I don't think this would work, in these circumstances -- if he knows he is being made redundant the money already belongs to the creditors, so I doubt they would accept the lump sum and give up what is already theirs.

How official is the redundancy ?
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Lisa Thomas
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by Lisa Thomas » Tue Jul 31, 2018 11:12 am
I agree with Foggy - some IPs will allow the debtor to retain 6 weeks worth of the redundancy pay to find new work but the balance is usually due to be paid into the IVA pot and any normal contributions would sitll continue (unless and until the total debt, costs and interest were paid off in full).

If you want to make a settlement offer for your friend it would need to be based on the redundancy, say less 6 weeks, plus the remaining contributions for the next year, less perhaps some saving on general administration costs etc (albeit many IP firms charge £500 for the variation fee).
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dawn20
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by dawn20 » Tue Jul 31, 2018 3:19 pm
Hi foggy just a question I've read a lot of posts about how u can keep 6weeks of redundancy money .what don't understand is how can u pay the IVA afterwards if u can't get a job . Creditors can't have the cake and eat it as they say no job no money surely the IVA should end then and not forgetting the creditors get payments from the 6weeks you've been left with not the best deal no job and not much to live off . I know that creditors need to be paid but losing your job is a major issue u can't wring blood out of a stone and it's not the person's fault their job has gone .
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Lisa Thomas
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by Lisa Thomas » Tue Jul 31, 2018 3:35 pm
If the debtor doesn't get another job then a variation could be proposed to accept payments to date in full and final settlement but there is always a risk creditors could reject the variation and the IVA could fail as the debtor hasn't maintained their contributions in accordance with the IVA terms, albeit through no fault of their own.
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Lisa Thomas
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by Lisa Thomas » Tue Jul 31, 2018 3:36 pm
Lisa Thomas wrote:
If the debtor doesn't get another job then a variation could be proposed to accept payments to date in full and final settlement but there is always a risk creditors could reject the variation and the IVA could fail as the debtor hasn't maintained their contributions in accordance with the IVA terms, albeit through no fault of their own.


The debtor can't 'have their cake and eat it' too - if they get redundancy pay and find new work with a similar income level then are likely to be betteroff hence having to pay the redundancy money over and continuing to meet their obligations.
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joanne905
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by joanne905 » Tue Jul 31, 2018 4:00 pm
Foggy wrote:
joanne905 wrote:
Partner has IVA and has about 1 yr left to pay. He is been made redundant so looking into it we believe they can take most of this and still make him finish his next 11/12 payments. Would it be possible for me to get a credit card and pay off his next yrs paymentsas a one off payment then when he gets his redundancy he can pay off my card. Would this totally clear thw debt and leave him with most of his redundancy


I don't think this would work, in these circumstances -- if he knows he is being made redundant the money already belongs to the creditors, so I doubt they would accept the lump sum and give up what is already theirs.

How official is the redundancy ?

Hi Foggy
They are still in talks and have been given 30 days notice but have to have one 2 one meetings and things before finding out any finishing dates etc. His sister has offered to pay off what he owes in one payment sk this is something less for him to worry about on top of worrying about whether he wl lose job or not but we are not sure if he can do this
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Foggy
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by Foggy » Tue Jul 31, 2018 4:09 pm
dawn20 wrote:
Hi foggy just a question I've read a lot of posts about how u can keep 6weeks of redundancy money .what don't understand is how can u pay the IVA afterwards if u can't get a job . Creditors can't have the cake and eat it as they say no job no money surely the IVA should end then and not forgetting the creditors get payments from the 6weeks you've been left with not the best deal no job and not much to live off . I know that creditors need to be paid but losing your job is a major issue u can't wring blood out of a stone and it's not the person's fault their job has gone .



Hi Dawn. The redundancy clause allows you to retain 6 months equivalent of net take home pay (as agreed at the last annual review date). This will allow you to make payments for another 6 months while seeking new employment. If, after the 6 months have passed, you can agree a payment break with the IP (which would be added back on at the end of the term).
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Foggy
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by Foggy » Tue Jul 31, 2018 4:15 pm
joanne905 wrote:
Foggy wrote:
joanne905 wrote:
Partner has IVA and has about 1 yr left to pay. He is been made redundant so looking into it we believe they can take most of this and still make him finish his next 11/12 payments. Would it be possible for me to get a credit card and pay off his next yrs paymentsas a one off payment then when he gets his redundancy he can pay off my card. Would this totally clear thw debt and leave him with most of his redundancy


I don't think this would work, in these circumstances -- if he knows he is being made redundant the money already belongs to the creditors, so I doubt they would accept the lump sum and give up what is already theirs.

How official is the redundancy ?

Hi Foggy
They are still in talks and have been given 30 days notice but have to have one 2 one meetings and things before finding out any finishing dates etc. His sister has offered to pay off what he owes in one payment sk this is something less for him to worry about on top of worrying about whether he wl lose job or not but we are not sure if he can do this


Hi Joanne -- I am afraid that, if Notice of Redundancy has been served, the compensation will already be captured by the IVA.

2014 Protocal says, at 10.5(a): A debtor who is subject to redundancy whilst in an IVA must:
Inform his / her supervisor within 14 days of notice of redundancy, regardless of whether he / she has received or is to receive any redundancy payment.
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