IP/IVA Company fees?

john10001

Just wondering how IP/IVA firm fees are calculated and whether it is usually a fixed amount or a percentage of the reduced offer amount added on top?

E.g. for example you owe £20,000 to various different creditors.

IVA writes that down to £8000.

Would an IP/IVA company's fee on top be for example £500, £1000, or a percentage of the reduced sum e.g. 12.5% of £8000... being £1000?

So you could end up repaying £9000 inc fees which would be roughly 45% of the original amount that was outstanding?

And over say 5 years you would repay £150 per month?

Just trying to get a handle on IVA's to get a better idea of figures for my own circumstances should I choose to go that route. I wish to do my homework first and carefully consider all options.

I believe I am getting closer and closer with my statement of accounts. Just trying to gague roughly though how much surpluss I would need for my debts to make an IVA a viable option so if you know roughly what fees would be expected for an IP/IVA companies services I'd appreciate your input.

It is very difficult to calculate for myself with variable pay but I am getting more and more close to being in possession of all the facts and accurate figures.

Thanks,
John

FiatFan_2

Just copied this off the StepChange web page as it was easy reference,

"There are always fees involved when you set up an IVA. The two fees that you'll need to pay will be a nominee and a supervisor fee. The nominee fee covers the cost of setting up your IVA and the supervisor fee is the yearly cost for managing it. The level of fees you'll pay will depend on your individual situation.

At StepChange Voluntary Arrangements our fees are set at the industry standard and we'll make sure you're fully aware of what we're charging. We will include the fees in your monthly payment, so there is never anything to pay up front."

I had a wee read through my iva agreement last night and whilst there are various fees to be paid, all in they equated to about £7000 over the 5years.

I admire your need to know the finer detail of the iva route, although I'm not entirely sure you could work out your personal fees etc. I believe typically the first three payments go to fees, then the rest are paid in percentage format through your monthly payment. Fees and the way in which there paid/collected is something that some of your creditors may have changed during the creditors meeting, I know mine were.

How variable is your pay? My wife's pay can vary anywhere upto £500 per month, the IP took an average of her annual wage and then tweaked it down toward your lower average. Any high wages will be dealt with the over payment rules, so far it's working in our favor

HTH

Anondebtadvisor

IP fees are split into 2 parts - Nominee Fee - for the work done up to and including the creditors meeting and Supervisor Fees - taken annually for the supervision of the case.

If someone was paying £150 per month x 60 months - the nominee fee would be about £1000 (creditors cap this at the creditors meeting)

Supervisor fee is usually 15% of total realistations and again creditors cap the fee.

Any fees will be included in the £150 per month payment based on this example

Avoid any company that will charge you an upfront fee to pass your case onto an IP, regardless of whether you use a debt charity or go to an Insolvency Practitioner direct the fees will be the same.

Any good Insolvency Practitioner will explain their fee structure willingly with you