unemployed and IVA

Greener_Grass

Hi, i'm looking for some advice

me and my husband have literally just set up iva's. there is one question that keeps going round my head. basically we have seperate IVA's that total £10,000 over the 5 years, our debt is £15,000.

My question is this, i do not currently work as I look after our son, My son starts school next september so i should really get a job. If i get a job for say £18,000 a year this will obviously increase our household income, what happens to the iva? am i right in thinking they take 50% of that? if so that would be at least £500 extra a month?

The confusing part is our debt is only £15,000 and we are paying back 10,000 so if our payments were to increase to say £700 a month this pays back a total of £42,000?! so how exactly do they work this?

My husband works in sainsburys and earns 8.5k a year and i have no income, we get child benefit, housing benefit (for less than half our rent) tax credits and working tax credits. we are literally paying every spare penny into the iva, i don't see how we can realisitcally live like this for the next 5 years. How do people do it? we have a "contingency" fund of a whopping £10 a month? how i'm supposed to ever take my son out for the day i've no idea! hence why i would like to get a job but please can someone help in how this would work with the iva

Sorry for the babbling, feeling so stressed about the whole thing, now our iva is arranged it hasn't actually helped my stress levels any as we are still paying out more than we can afford

Better_Off_1983

Hi,

When the credit was taken out... were you in work at the time?? Just a general question.

cabbage

wouldn't you be better off with a DRO each instead of an IVA? Seems to be a lot of payment and only a £5k write off at the end. I am assuming your joint total debts are £15k

Depth_Charge

Greener_Grass wrote: »

Hi, i'm looking for some advice

me and my husband have literally just set up iva's. there is one question that keeps going round my head. basically we have seperate IVA's that total £10,000 over the 5 years, our debt is £15,000.

My question is this, i do not currently work as I look after our son, My son starts school next september so i should really get a job. If i get a job for say £18,000 a year this will obviously increase our household income, what happens to the iva? am i right in thinking they take 50% of that? if so that would be at least £500 extra a month?

The confusing part is our debt is only £15,000 and we are paying back 10,000 so if our payments were to increase to say £700 a month this pays back a total of £42,000?! so how exactly do they work this?

My husband works in sainsburys and earns 8.5k a year and i have no income, we get child benefit, housing benefit (for less than half our rent) tax credits and working tax credits. we are literally paying every spare penny into the iva, i don't see how we can realisitcally live like this for the next 5 years. How do people do it? we have a "contingency" fund of a whopping £10 a month? how i'm supposed to ever take my son out for the day i've no idea! hence why i would like to get a job but please can someone help in how this would work with the iva

Sorry for the babbling, feeling so stressed about the whole thing, now our iva is arranged it hasn't actually helped my stress levels any as we are still paying out more than we can afford

Hi

Struggling so early in an IVA does not bode well and yet another problem with payments enquiry concerning IVAs

Just to clarify, do you mean an interlocking IVA?

The fact that you are into housing benefit would suggest that you have little or no disposable income in the first place, that is basically why housing benefit is paid to help people with housing costs on low incomes (housing benefit entitlement is processed via a standard applicable amount calculation)

If the payments increase as you have alluded to it will probably work out that you will just pay your original debts off plus the IVA costs & fees which are likely to be a few thousand and some.

Check your IVA proposals with regard to changes in circumstances / incease in income etc and of course you could speak to your IP as it is always best to be sure.

Like another poster has asked, could DROs have been a possibility?

Was a DRO explained along with other options?

Greener_Grass

No i was not in work at the time the debts were ran up, they've literally been ran up these past 3 years, we had a child while my husband was at uni and he hasn't managed to get a decent job since finishing

Yes our total debts are 15k, another thing that seems very strange to me is in our individual iva's our joint debts are listed as the full amount in both? our joint debt is only £2600 of the 15k

DRO was never even mentioned to us and i've totally no idea why, I had no idea it even exsisted until a couple of weeks ago while looking on here.

The whole debt thing has just been a complete nightmare, I contacted payplan out of desperation as we could not afford the minimum repayments any longer, they advised me an iva was the best thing to do but as you say theres not much being written off, We are paying back 10k yet payplan take a huge percentage of that . This all seems to me like this is the only reason they wanted us to have iva's in the first place?!! Ever since I contacted them i've felt pretty railroaded into everything, they are very pushy constantly harrasing you to do the next step. Now the iva is in place I don't feel like any of the stress is lifted as we are still paying back more than we can afford and now i have this worry over my head about getting a job as obviously i do not want to pay back more than i owe, it all just seems a bit rediculous. help please

milliemonster

It's a shame you were pushed into taking an IVA with payplan, you should really have spoken to 2 or 3 companies really to get a better reflection on what could be proposed but I guess that's by the by now, on the face of it it seems a DRO would have been better.

In answer to your questions, your joint debts will be listed in whole on each of your IVA proposals as you both have responsibility for the full amount of the debt, it's not split between you.

If you get a job, they should only take 50% into consideration but I know payplan take the additional income from the month of the change in circumstances (other IVA companies including mine, don't do it until annual review meaning you could potentially have up to 11 months of additional income that is not taken off you) but you have to check what it says on your proposal.

Remember if you get a job you are going to have other expenses like clothing, travel to work, work lunches etc which you will need to offset against the 50% extra income they would take from you anyway.

Allowances are guided by CCCS guidelines which is what the creditors like IP's to adhere to, but a £10 emergency allowance is rubbish! ours is £45 a month, but you must have agreed to that when you got your proposal and signed it? did you not question it? we certainly did with any of our allowances that we felt were too low, we just rejected them, suggested our own and provided evidence to say why if we needed to and our allowances I do feel now are comfortable and we have no problem sticking to.

Regarding if you got an £18k a year job, you would only ever repay the full amount of the debt you owe £15k) plus fees then your IVA would end.