IVA and backdated housing benefit

Mum24_2

I have been on my IVA since December 2011. My last annual review showed that "on paper" I could no longer afford the repayments but I have been making them anyway and we have been struggling.
My husband works full time and I look after our 4 children.
I have recently discovered that we qualify for Housing Benefit. This will be backdated to Feb 2014. We are soon to receive a lump sum of around £900 to cover this period.
As I have, in theory, been "overpaying", will this be taken into account? Will my backdated housing benefit be considered a windfall or can we keep at least some of it? I am so confused and any help would be very gratefully received!
Thanks in advance.

beanielou

I dont know,sorry.
But hopefully someone will be along soon to help.

longtermplanner

I suspect it does count as a windfall technically. But this will depend on (a) the wording of the windfall clause in your T&C and (b) the reaction of your IP. My feeling (without any evidence) is that smaller IPs are often more reasonable about listening to you than the larger ones...

Does your husband also have an IVA? If not, then I would argue that half of the money should be his.

Mum24_2

Hi. Thank you for your replies. My husband doesn't have an IVA so hopefully he can keep his half! Also, do you think they might consider deducting my "overpayments" from what they keep? I don't mind paying what is fair into my IVA but we could really do with a little money at the moment as we have been struggling so much since my last review. I am with Freeman Jones. I will speak to them tomorrow and let you know what they say. Thanks again

Giggles_Fairy

Check your annual review - does it say your income and expenditure was reviewed or not? If it says it is not reviewed then you can not use the information off, as the report states it is not up to date.


If it says the income and expenditure is reviewed then how have you been managing? Have you been making cutbacks? Have you borrowed from family? Do you have a sundries/emergencies or spares and servicing allowance on your income and expenditure that you have not been able to put to oneside due to having to cutback? Any of these could be a justifiable reason to say you need to keep the money as you have been maintaining your payments by doing these, so if the housing benefit had been awarded in Feb 14 then you would not have had to.


Is the housing benefit award in joint names with your husband? If so you should be able to keep 50%. Make sure you photocopy the award letter to send to your IVA company straight away to evidence it.


Ask your IVA advisor to speak to the IP with the above information and check how much you need to pay in.


Let us know what they say

Mum24_2

Thank you. Yes, the award is in joint names with my husband.

We have been making cutbacks, borrowing from family and my husband has even had to take out a couple of nasty pay day loans just so we can survive. It really has been a horrid time!

I will call first thing in the morning and let you know what they say.

Thanks again for the advice

longtermplanner

Payday loans - eek... And you are on housing benefit and so renting? Why did you agree to this IVA in the first place? You would probably have been better advised to go bankrupt...

Will you be able to comfortably meet the IVA repayments now you are getting Housing Benefit? If the answer is no, then you should probably consider ending it and going bankrupt. There is no point in you struggling to clear your debts and your husband getting new and very expensive ones!

Mum24_2

Hi,

I have spoken to Freeman Jones this morning. They were really helpful. They began by saying my husband can keep his half of the award. Then they looked at my half and deducted from that the amount I had been overpaying into my IVA since January and, on this basis, we are allowed to keep 100% of the backdated payment. This is such a relief! We can pay back what we have borrowed from family and the dreaded payday loans and have a little extra to treat the children.

I chose an IVA because I wanted to do what I thought was the right thing - paying as much of my debt off as I could. I am halfway through now and the housing benefit entitlement now means we can afford our payments again.

Thank you all for your help and advice

longtermplanner

Excellent result!

The only thing I want to say, and I hope this doesn't sound mean, is please put that little bit extra into a savings account for when you next have a hiccup. The best thing for your children is not a little treat now, but unstressed parents who know they are going to be able to get through to the end of the IVA with no more borrowing.

Why not have a look for a credit union in your area?