IPA help please

skintoz

Hi skint newbie here.

I am currently looking at an IVA and waiting on a company getting back with a proposal.

Looking again at my situation i am starting to feel bankruptcy might be the better option as i have no real assets and debt of 30k on cards and loans.

My questions about any possible IPA are
'
1. I was under the impression the OR contacts landlords but i have now read on the guidelines to OR's that there is only a need to contact landlords if the landlord is owed rent. Is this still the case? or is this based on old info?

I am up to date with rent and there is nothing in the lease still don't really wanting them finding out and perhaps having to move while dealing with this at the moment .

2. When calculating income will I have to declare all my partners earnings? our earnings are 60 / 40 me being the 60 percent, She has her own debt to pay as well so would you deduct your partners costs to their creditors first? she wouldn't want to be paying off my debt from the pot.

Would they just want to see her income to calculate my 60% costs of expenses like rent, shopping, child care, utilities and council tax?

Or do they just add up all the expenses and if you had £100 left they would say £60 for the IPA and £40 back for the partner?

I have expenses like child maintenance which she obviously doesn't pay towards or my car and it's costs.

3. Child Maintenance costs do these have to be through the CSA to be taken into consideration? i have a private arrangement via standing order every month.

4. Child benefit and child tax credits are paid to my partner in working out income do they just give you 50% percent each to work out each income available per month?

Thanks

Wayforward

I can help on two of these -
1. My OR did not contact my landlord at all , i was uptodate on rent.
and
3. I pay my ex wife child maintanance which is a personal agreement between myself and her , this is a bit less than what the CSA would have asked for , and is paid standing order , OR was fine with this as could see the payments leaving my bank.

skintoz

Thank you Wayforward that is good to know.

fermi

An IPA can only be made from YOUR surplus income. Your partners income is to help calculate how much of yours is surplus, given a pro rata split of shared expenses.

Have a play with the OR's IPA calculator spreadsheet to see how it works in practice.

---> IPA calculator Post 01 December 2010

skintoz

Thanks Fermi i am having a look at it.

longtermplanner

skintoz wrote: »

Hi skint newbie here.

I am currently looking at an IVA and waiting on a company getting back with a proposal.

Looking again at my situation i am starting to feel bankruptcy might be the better option as i have no real assets and debt of 30k on cards and loans.

Bankruptcy may be a better option from what you have said. There is a look at the advantages and disadvantages here: http://debtcamel.co.uk/hard-choices/iva-vs-bankrutcy/. The only thing you mention that might be a problem in bankruptcy is your car. How much is it worth? Is it necessary for you to get to work?

4. Child benefit and child tax credits are paid to my partner in working out income do they just give you 50% percent each to work out each income available per month?

That depends on how you divide the child-related expenses. If your partner pays for all the children's clothes, school trips, food etc, then you could argue that she should have all the child related benefits income. But if you are dividing all household expenses between you (which would probably be simpler) then the benefits income should also be shared.

skintoz

Thanks Longtermplanner, the car isn't worth much under 1k, yes i think probably BR is probably the better option as well now.

I am waiting for an IVA company to get back to me and tbh they have been pretty good so far, one IVA company was just trying to get my partner into a IVA as well which annoyed me as she has no real problem paying her creditors the only problem she has is me not being able to pay mine and a fair share of the bills.

skintoz

Thanks again for the help.

Final question for the moment, when thinking of going down the IVA route i have opened a new bank account with a bank i have no credit with.

They have gave me a current account with no overdraft or cheque book and the IVA company said this would be ok.

If or when i apply for BR i understand this account will be frozen and possibly closed or downgraded, how long do they usually freeze the accounts for?

I am moving money and standing orders into this accout from my current bank this week as it was too late to get wages paid into the new account. Basically i am going to pay out my standing orders and withdraw any cash for day to day living and declare it cash in hand but would obviously hope it's unfrozen before my standing orders would be due the following month.

Is this a bad plan?

The strange thing was when i opened the account they asked if i had ever been bankrupt and after i said no they said they didn't care anyway as they would still give me the account, must need the customers

longtermplanner

Which bank?

If it is the Co-op or Barclays, they will let you keep the account after you are bankrupt. Most others will close the account, not just freeze it.

Barclays will let you open a basic account whilst you are undischarged, but no-one else will at the moment so far as I know.

skintoz

No it was one of the other big banks who according to various forums are not bankruptcy friendly but i opened it in a small local branch.

I can't go near Barclays at the moment as they will be one of my creditors.

When i go for the bankruptcy i will just go the local branch and tell them, if they want to close it then it will give me more time to get something else sorted before next payday.

Still trying to get my head round the SOA form! the link Fermi gave me makes sense they split the ratio of income against the household expenses and then work out any of surplus for the person seeking bankruptcy. Do the OR's use this spreadsheet or something similar to calculate surplus income?

The CAB calculator which is linked on here just adds both incomes - household expenses then says i have lots of surplus income which i don't because it doesn't take into account my partners other expenses and the fact her surplus income shouldn't be going towards my potential IPA it is more like what they use for IVA's

Edit - I understand now on the spreadsheet i put partners full income and it works it all out and on the CAB one I put the partners contribution (I think)

So on the SOA form should you put partners full income or just the contribution?