In an IVA already, unsure if it was the best option?

doobytunes

Hi,

Ive been in an IVA for over 2 years, Ive kept up with payments apart from a 2 month period while I moved house. This was taken into account and I have increased payments to compensate. My original debt was around 19K and I started out paying 265p/m and pay 330p/m now.

I am unsure as to wether an IVA was the best option for me in the first place, the main reason being that I didnt (and still dont) have any assets like a house or car. Secondly, I am earning more than I was when I took out the arrangement (20K then, 30K now)

I rent my flat (shared with 1 other) and I am in full time employment.

When I took out the IVA, I was just glad to have put an end to the letters and paying out so much interest. I was pleased that I had done something about my debt, and Im still glad that things have been going in the right direction for over 2 years.

But was the IVA right for me in the first place? The payments arent a problem but Im sure that they will go up when my annual review comes back. I cant afford to realisticly pay much more back if they do go.
What happens if you pay more, can you "overpay" your IVA? ie: pay more back than originally owed (taking the setup fee's into account). Or do you just complete earlier? What happens if it turns out that you were mis-sold an IVA? what are the options?
I'd like to start rebuilding my credit as soon as possible, but realise this will take time. Ive booked a day off to go the Citizens Advice Bureau next Thursday, what can I do before then to prepare?

Any advice would be much appreciated,
Thank you in advance,
Lester

fnc6810

At the time when you were most desperate it was, although saying that, puting your last £50.00 on a horse in the grand national would have been right if someone told you to.
Now things have slowed down and your back in a routine you start to wonder about the advice given and was it the correct course of action.
I think it is right for some people and i also think it is right to pay back as close to 100% of their debt as posible. But the question that is asked is "Is an IVA right for the IP's who push people towards and IVA". I look around some of these forums and see how much debt people are in and my IVA was peanuts compared to theirs. I phoned for Debt advice in Jan 2003 and before i knew it i was in and IVA, I was gullable and an easy target and the IP i spoke to sounded genuine, I was a HGV driver at the time spending most of the week away and my wife overspent a little and working p/t couldn't afford payments on the credit cards. (the card companys were increasing credit limits so that didn't help) so this was extra money i was paying, but my wifes total debt was only £9000ish. Obviously not enough for an IVA My own debt was only £6000 so totaled together it just made the required sum. My own Debt was OK my credit file shows this, so why did he tell me i would have to be included i don't know. Any way the guy kept on refering to this as a Voluntary Arrangement he sent out a booklet called "your Questions Answered" very brief and says nothing of fee's or payments, so this guy we put our trust in was well on his way to making his money. Now i live in the Midlands and he is in Lancashire so we had no face to face contact. So thinking about it now its like having a leak in your water supply and phoning a plumber and receiving a leaflet from him the next day called "How to fix your tap" and still being charged £150 callout fee.
There is a lot more to my story so let me know if you want to see more, But the outcome was
Jan 03 Debt Advice, May 03 IVA Approved (with mods) 100p in the £ was on the original proposal, Nov 04 IVA completed Creditors Received 100p in £ (but not according to the ones still phoning and sending letters) June 2008 Final report and accounts clearley showing that i overpaid (about £2600)

You say you can afford more but ask yourself is my job secure? Don't over commit as we have seen things can change quickley. What dividend are you paying back if its say 60p in the£ then the creditors would just expect a bigger dividend If it is 100p in £ it is possible to pay early--But youre IP would not up your payments to the required amount to do this because he would be loosing out on his fees.
But saying that he could still charge you the same as if it went full term. Mine did even though it stated in the proposal if the length of the IVA is reduced the fees must also be reduced.
So what i'm trying to say is i have not got a clue mate IP's in my eyes can move the goalpost as and when they like and charge what they like.
One of the most likley answers you will get on this forum is "Speak to Your Supervisor" but in my case mine will not speak to me.
My credit file is full of mistakes and companys still hassleing me but not every case is like mine. read through all your paperwork, the proposal and terms and conditions see if there are any restrictions but instead of being thanked for being Honest and wanting to pay of your debt quicker your more likely to be punished financially. Anyway sorry for rambling on you might be able to pick a few bones out of this or my other posts, I'll keep an eye out for an outcome on this
Best of Luck
fnc6810 :beer:

doobytunes

thanks to you both for taking the time answer. we'll see what happens.

pa49

An IVA is a legaly binding agreement as to how to deal with a situation in which there is debt that can't be accommodated by previously agreed terms and conditions. It's a re-negotiation and once agreed is binding on all parties. Otherwise what would be the point?
You pay what was agreed to your creditors and you pay the fees and charges that are agreed with your IP. Anything above and beyond is an overpayment and is recoverable by the debtor.
The last point holds unless there is a variable repayment requirement in the IVA. This is very unusual and should be something that is apparent to the debtor.
The amounts are required to be accounted for by the IP and if errors are made then they are liable in just the same way as any other proffesional would be. Any overpayment should be spotted by the IP and repayed to the debtor.
The creditors are not able to benefit further over and above the terms of the IVA unless the debtor gives willing and unforced consent.
However, you have to be using a chartered/registered IP otherwise you are swimming with the proverbial sharks.
Caviat emptor!

parrotfan

Hi Doobytunes

I am currently in an IVA - have been for 32 months. I started on £250 per month and then my salary was increased. last review they upped my payments to £689 per month!!!

Anyways, I've not paid the increased payments. I have no assets. I am mid forties and to be honest, I haven't committed any crime but feel that in an IVA I'm constantly being punished.

So I'm biting the bullet and moving over to the bankruptcy board. At least with bankruptcy the Official Receiver will only take between 50 and 70% of my disposable income - not 100% like the IP.

It entirely depends on your circumstances but with my credit rating at zero whichever one I choose, then I choose the fairer of the 2.

I should never have done the IVA in the first place but very much doubt there are grounds for a mis-selling claim. As fnc6810 said - at the time I took mine out I would have signed anything to get my creditors off my back so failing to read the small print is probably not a defence.

Good luck with the advice at the CAB - I would be interested to hear what they say to you.