IVA company demanding another £2000+

hammerette_2

I have been in the IVA for 2.5 years, gave incomings and outgoings at start of IVA,and this gets redone every 12months. Every quarter I send the previous quarters wage slips for their records.
Originally the IVA was set at £410 per month after the 1st year my tax credits fell by £200 per month due to a change of job, the IVA company did a review and they agreed for the payments to be changed to £212 per month, (but they advised due to amendment and the amount of which my payments had fallen my IVA would be 5 years from the date of the new fixed payments).
To my horror I received 2 letters from my IVA company today advising that the difference from the income (salary only) declared at 1st signing the IVA to the amount on wageslips to date is £4000+ and that under the terms and conditions I have to pay 50% of that into the IVA. They have asked for £2000+ to bring the arrangement up to date.
As with everyone we had had payincreases but all the outgoings i.e food, petrol,gas,electric has increased aswell.
I am not sure how I stand as being in an IVA does not leave much spare cash so how do they expect me to pay this, They have seen every wage slip from the start so why have they waited 2.5 years to do this to me.
They have compared the difference in earnings to the original paperwork, but since then 2 reviews have been done to show wage increases.
I dont understand, and worried as to what this means.
Are they acting correctly
Surely they have earned enough fees to make sure they are managing my debt and shouldnt be adding to it
any help gratefully received

blind-as-a-bat_2

It is my understanding that any SURPLUS amount may be included if you get an increase in income over the life of an IVA, so yes they are correct, but wrong on the amount as its not surplus due to the increase cost of living as you have stated.:D

The fun bit is reaching a commen ground on what, if any increase in surplus you did actually gain:rolleyes:

lexie2005

My IVA is reviewed once a year but one of the conditions is that any overtime/increase or bonus has to be split with them 50/50. I think that if they have not noticed this then you have grounds to talk to them about how you can sort this out with them. Which company have you gone through if you don't mind me asking...... We are with DFD & they have always been really supportive...............

Rylynn

That is correct ANY surplus ie any increase in income from anywhere even benefits increasing ie working tax/child credits, and they also include child benefit which BR does not.

IVAs are pretty tough to weather out over 5 years, which is why so many are failing.

Bald_Runner

I have been an an IVA for six months and am paying 100p/£ with the fees on top. I owed £75000. I have to send in my payslips every six months so have just sent the first batch. I accept that I have to pay half of any overtime. I to have had a letter stating that I have to pay a couple of hundred pounds because I had a £50 pay rise. I believe that as the cost of living increases, this should be classed as a cost of living rise and ignored. After all, what are the creditors going to do, make me bankrupt for £200? I think not

moneysavingplumber

Any increase in contributon in to the arrangement should be agreed at each annual review at the latest, they shouldn't, as far as I'm aware, start chasing for a missed increase in salary from two years ago.

In my IVA they did once send me a breach letter saying I was £167 in arrears. I rang my supervisor's office and argued that as they had set the payments (£240 per month), none of which I had missed, and as they had had my accounts and statement of earnings quarterly, I could not possibly be in arrears, and if I was it was their fault as they had not informed me of any necessary increase. I never heard any more about it. Having said that and having read alot of IVA nightmare stories here, it does seem that my IVA company were better than most.

I would advise speaking to your supervisor (not one of their assistants) asap.

Rylynn

I would say here and now I tried to speak to mine when things were going up and was told basically tough! There was no leaway down the scale, it was written in to the original contract, but they would take ANY increase and were not bothered that it was simply cost of living increase either.

So everything went up, and my standard of living just got worse, and it was bad enough when it began a year in it was horrendous. So things like clothes went out the window, so who suffered, my son, which I felt was totally unfair.

Getting ill was not funny but it helped me make the decision to go BR once they said the IVA had failed and I will never regret that visit to the court.

moneysavingplumber

Well it was one of the rare cases where my being self-employed was actually an advantage, within the bounds of legality I made sure never earnt more than I was supposed to, consequently I was one of the lucky ones that never had an increase for the duration of the agreement.

I am pretty sure though that once the annual report has been sent to the creditors after the review, it isn't really necessary for the IVA provider to review further than the preceding twelve months again, the annual review is just that, so they shouldn't be asking you for additional contributions that go back past the last review, as that will mean they didn't do it properly, especially if you have submitted payslips as requested.

Rylynn

Which for me means that he has a case against the IVA company for bad practice, they cannot possibly say this after 2.5 years, please dont bother phoning the IVA company phone the CAB and Nat Debt line and get some more advice on this, sharp practice if you ask me!!

moneysavingplumber

Have you kept copies of the creditors' reports from the first two annual reviews? These should detail review of the income and state clearly whether an increase in payments is or isn't necessary under the terms of the agreement. If it clearly states that they have reviewed I & E (as it should) and that they don't require an increase in payments then I wouldn't think this would stand up another half year after the second review. The only way it would would be if it was something you hadn't disclosed that they had become aware of later, doesn't sound like it in this case though.

hammerette_2

thanks for all replies. I spoke with national debtline yesterday, and they agree with me that 50% of net income include benefits. My arguement is that yes mine and my husbands wages had an increase but the tax credits fell by £400 per month, so infact our total incomings were less then when we 1st set up the IVA. That is why a varation was done at the end of the 1st year to reduce payments from £495pm to £212pm. National debt line says the IVA have only looked at the salary increase and not net income as stated in the terms and conditions, they are sending me the paperwork to lodge a complaint to the IP's regulators.