What point will I be able to complete my IVA?

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Charly.p
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by Charly.p » Tue Oct 03, 2017 3:50 pm
Hi,

I have been in an IVA since October 2014.
My original debt was £33,225.
In the past 3 years I have paid £37,982 towards my IVA.
The supervisor fee is 15% of realisations and a nominee fee of £1500.
At what point will I be able to complete my IVA as I can't go on paying £500 a month until the 5 years are complete, or can I?
Sorry if this is a simple question, I've found the whole thing quite confusing to be honest!

Thank you
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Keith White
Industry Expert
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by Keith White » Tue Oct 03, 2017 4:15 pm
I think you need to check with your IVA company about how many more payments you need to make. Once all debt plus all fees are paid in full - that would normally bring the IVA to a close.
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Foggy
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by Foggy » Tue Oct 03, 2017 4:24 pm
During an IVA we owe the full original debt, plus fees and possible statutory interest at 8% p.a ( this might have been excluded -- check your paperwork).

On a debt of £33225 -- you would have to hit payment around £40,000 before the IVA will conclude ( assuming no statutory interest). At £500 per month you should hit that soon. If interest is applied that would add another £2600 p.a.

The indications are that you will finish earlier than the full term at this rate.
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Charly.p
Posts: 17
by Charly.p » Tue Oct 03, 2017 6:19 pm
Thanks both.

Yes, I think statutory interest is included so I'll take this into account.

It's my annual review soon and I think my payment may actually increase - but that just means I can get this cleared quicker.

I will ask how many payments I've left but Payplan never give me a straight answer on these things.

I have just noticed that my chairman's report has fees of 15% whilst the agreement I signed states 20% - is that standard? I probably should have noticed sooner!
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Foggy
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by Foggy » Tue Oct 03, 2017 6:40 pm
Charly.p wrote:
Thanks both.

Yes, I think statutory interest is included so I'll take this into account.

It's my annual review soon and I think my payment may actually increase - but that just means I can get this cleared quicker.

I will ask how many payments I've left but Payplan never give me a straight answer on these things.

I have just noticed that my chairman's report has fees of 15% whilst the agreement I signed states 20% - is that standard? I probably should have noticed sooner!


The agreement you signed is the proposal and Payplan (optimistically) proposed 20%. However, the creditors routinely amend fees and the agreed level is that recorded in the Chairman's Report. Payplan are notorious for avoiding any answers, but, in their defence, because the interest element is calculated daily on the reducing balance it is difficult to predict an end date until it is much closer.
Adam_7985
Posts: 25
by Adam_7985 » Tue Oct 03, 2017 7:08 pm
Just checking, you say you've paid £500 a month for 3 years that £18k, have u been making overpayments?
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Charly.p
Posts: 17
by Charly.p » Tue Oct 03, 2017 8:06 pm
Adam_7985 wrote:
Just checking, you say you've paid £500 a month for 3 years that £18k, have u been making overpayments?


Hi Adam,

Yes, I had a good bonus from work and inheritance that have all gone in the pot too.
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Charly.p
Posts: 17
by Charly.p » Mon Oct 09, 2017 3:57 pm
Can I please check how the 8% statutory interest is calculated?

Is it done on initial debt and then as 8% of the remaining debt each year? And do I then need to add that 8% to the debt remaining each year to get the new amount owing?

Or something different?

Sorry, I find maths hard work!

Thanks!
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Foggy
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by Foggy » Mon Oct 09, 2017 4:47 pm
Charly.p wrote:
Can I please check how the 8% statutory interest is calculated?

Is it done on initial debt and then as 8% of the remaining debt each year? And do I then need to add that 8% to the debt remaining each year to get the new amount owing?

Or something different?

Sorry, I find maths hard work!

Thanks!


It is 8% of the outstanding original debt, calculated daily on the reducing balance from the start date of the IVA to the current date. Simple interest, not compound. So, yes, it is an awkward calculation without the computer software !
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