Iva

Julieb73

Hi. I am in the process of setting up an iva. Current situation is : application is on hold for 1 week while negotiating with a debitor. The company I am dealing with told me during initial discussions that when my car is paid off in October... I will be better off by £200 and they will renegotiate terms so I keep the money. I am now being told that's not the case and by the end if 5 years of payments I will have paid more than I owe. I don't know what's right or wrong and I don't want to carry on if I'll end up paying more than I'm owing

National_Debtline

Hi Julieb73 and welcome to MSE,


We will need a few more details to help you calculate this, such as, how much do you owe, how much are the monthly payments scheduled to be initially and what is the IVA fee? Another issue could be if you are a homeowner as the equity in the property can affect calculations. All IVA's will work differently, but generally speaking, any additional surplus will need to be paid to the IVA and that will come to light at the 12month review.

If you have not yet had the creditors meeting you should be able to cancel the IVA and consider other options, however, if the creditors meeting is in progress it can be harder to cancel. You will need to check the terms and conditions of what you have signed.


Laura
@natdebtline

sourcrates

You cant renegotiate an IVA once it's agreed, I would wait until your car is repaid, then re-evaluate the situation.

Julieb73

I owe 12 thousand to various plsces. The local council being the majority holder. The monthly payments are set at 79 per month. However, the council have added 17/18 ct bill to the iva and want me to pay the 120 which I pay to ct to be paid into the iva for this year only. When the car is paid in October the payments go up to 279 per month which means I'm paying more by the end of 5 years. Currently im hardly eating and my daughter is paying for my fuel so I was told to renegotiate terms in October so that the 200 staying in my pocket. I'm not a homeowner. The creditors meeting was Tuesday

Julieb73

I'm not in a position to wait as I have bailiffs at my door which is putting me under a lot of stress... sleepless nights and threats of my car being clamped etc

fatbelly

Julieb73 wrote: »

I'm not in a position to wait as I have bailiffs at my door which is putting me under a lot of stress... sleepless nights and threats of my car being clamped etc

If the car is under HP or conditional sale, then it's not yours and cannot be taken under control by bailiffs.

If the car is yours, then the finance is an unsecured loan, which would be going in to the IVA.

So it sounds like the former applies and you should continue to laugh at the bailiff through the window.

With 12k debt and 279 soon to be available I would be paying what I could to council tax now (to the exclusion of non-priority creditors), then re-evaluate in October and look at a debt management plan (or possibly a DRO if an intermediary decided that you fitted the criteria - probably unlikely but worth looking at)

National_Debtline

Hello again,


Although all IVA's can be different, generally speaking if the council were the majority vote then they tend to reject an IVA because they don't want any of their debt to be written off. How did the creditors meeting go?


Hopefully, this is something you can reconsider doing because based on some rough calculations, you would pay £79 for 5 months (until October 2017) = £395 and then £279 for at least another 4.5 years (based on the car payments finishing and nothing else changing). You would need to check the terms and conditions of the IVA to see if you can keep any of this additional surplus, if you can't it would mean you would pay, approx., another £15000 into the IVA. You do also have to factor in the IVA fee versus bailiffs fees, but it does look at though you could repay more over the course of an IVA, than you would in negotiations.


I appreciate you are not in an easy situation, and may need some budgeting/ benefit advice, but if you have an ability to get out of the IVA, it is something that I would recommend you consider. You should also try and get some advice from a free debt advice charity about other options to deal with the debt, if you can cancel. Good luck either way,


Laura
@natdebtline