Redundancy/Final Year

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sosilly

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Post by sosilly » Fri Sep 18, 2020 11:17 am
Hi

Our IVA was approved in September 2014 and it was a 6 year IVA not a 5 year so is due to end at the end of November. I have just had the letter to ask for property valuation, mortgage redemption statement etc and if there is equity will need to look at getting a re-mortgage or extending for another 12 months if that is not possible so I am in the process of doing this now. Will they wait to issue the annual review paperwork until the above is complete?

I have just been reading through the IVA proposal and saw the section on redundancy. My husband was made redundant last December. He finished on the Friday and started a new job on the Monday. He received £3,500 redundancy. My understanding of it was you were allowed to keep 6 months of the redundancy pay without having to hand anything over so we didn't declare it as it doesn't equate to 6 months salary but what I didn't realise is until i have read the section again is that if new employment is found the remaining redundancy money is to be paid into the IVA and you were also supposed to let the IP know within 14 days of receiving the redundancy notice which we didn't do so now i am in panic stations that we are in breach of our IVA and what might happen. It can't fail at this late stage after all this time. I feel so stupid for not looking at the redundancy clause at the time he was made redundant and what should i do. Has anyone else been in this situation and how was it handled.

The P45 does not mention any redundancy payment and the payslips from one company to the next are consistent there is no gap so for all they know he could of just left his other job to start a new job. The P60 for this year which will form part of the annual review states figures for both companies what has been paid from April 19 - April 20.

Is there another way they can find out if he has been made redundant and indeed has received a redundancy payment or whether they would just think he has changed jobs.

If i declared it now what might happen.

Thanks
sosilly

Foggy

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Post by Foggy » Fri Sep 18, 2020 11:43 am
The redundancy compensation will show up as an out of the ordinary credit on his bank statements, if they call for and examine these they will probably notice. If there was no malice, such things are often dealt with by simply repaying the missing amounts --- most IPs realise that getting a lump sum to cover this might well be impossible, so they will probably agree to either increased payment amounts or a further extension to the term.

On the question of equity -- there was some mention of this in the Covid-19 Guidelines -- have a read here: https://www.gov.uk/government/publicati ... a-protocol

IPs should follow these guidelines ( though, it seems, most simply hope they are not known about). Unfortunately the redundancy faux pas puts you on the moral back foot !!
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

sosilly

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Post by sosilly » Fri Sep 18, 2020 11:58 am
Thanks Foggy

In the past bank statements have not been requested as part of our annual review - only payslips and P60s have been required. Ok so at worst if I explained the situation an agreement could be made to just pay back the redundancy amount over a period of time.

Thanks for the information on Coronaviris IVA protocol amendments. This is helpful. I think i will still proceed with the usual process as I just want the IVA to come to an end as soon as possible rather than it being extended for a further period until the equity can be addressed. It may well be that we are going to be over the £10,000 equity allowed for our Interlocking IVA unless the estate agent will value it down on the basis of a quick sale so it will be extended by a further 12 months anyway so any delays beyond that I would want to avoid if possible i think.

Sorry i am not sure what you mean in your last sentence re "redundancy faux pas puts you on the moral back foot !!" What do you mean by this?

Thanks again
sosilly

Foggy

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Post by Foggy » Fri Sep 18, 2020 12:41 pm
Just that the redundancy situation technically puts you in breach of the arrangement, so your position to argue about equity release is weakened a little.
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

sosilly

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Post by sosilly » Fri Sep 18, 2020 1:14 pm
ok thanks foggy I get you. No thats fine. I will proceed as normal and hopefully all is ok.

Many thanks
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