Gutted.

MightyMum86

Hi everyone, I have an IVA in place, it ends 06/21. It was taken out when I first became a single mum (I have 4 children, 12, 11, 9, 7). My circumstances where pretty bad, the ex left me in a lot of debt in my name and the house had negative equity. This seemed the best way to sort it and up to now it has been a God send.


Roll on to now, I'm self employed, I work about 16 hours a week its been hard work and I was finally getting somewhere this year (bussiness is 3 years old) but I have been sick a fair bit since March with several bad bugs that have litereally left me in bed it has now resulted in an issue with my liver and thyroid and am waiting to see a specialist, fingers crossed I'm on the mend. This has obviously been hell and knocked my bussiness pretty much back to the beginning. Currently I havent been able to work for 9 weeks. Of course this now means that I cant guarantee to pay for childcare when it comes to the next holiday and have been thinking about seeking emplyment.



My IVA company have been great and offered to extend it so that I didnt have to pay for a couple of months. Today I rang and said look I'm in a place where I can pay this months. He took my payment and as it was going through we where talking and I said: Well to be honest I'm considering just finding paid work as a teaching assistant, and then I dont need to worry so much about child care. He said: ahh yes paid employment would have been better for you being ill recently. Then I said: Well I think if I do that hopefully I can have this paid off in a year : insert mic drop :


I had never been told about the 10% allowance and then 50% where raises in salery are concerned and had been told previously that *I* could pay off the lump sum early. I dont have a friend or family member who could gift me the money and my boyfriend of 4 years has offered to. The reason I wanted to pay it off early was because we have begun speaking about moving in together and buying our own place. Firstly I'm really worried this could raise questions with benefit agencies if he gives me the money and I am incredibly wary of having anything they might deem... Decietful? So is there any way that I can get this paid off early without taking help from somewhere else?


Mainly I'm worried that if I do become employed, coupled with the less tax credits and housing benefits I would recieve in addition to the IVA extra payment there is just 'no point' in trying to better my family and just stick it out until completion. I'm just hoping someone can tell me I'm wrong. It throws so much into question about the future I was begining to plan and its taken such a lot to get here mentally, physically and of course financially.



My Total debt would be around £35k so theres no chance of that being paid of before June 2021 if I earn more.


Also the last time my income and expenditure was taken was 2015 when I was on Income Support should I tell them we need to reassess? (Which of course right now any increase I wouldnt be able to cover anyway.


Thanks in advance!

Daniel1971

The details about what happens if your income increases would have been written into the proposal document you originally signed.

You should really have an annual review within an IVA. Any changes to income should be taken into account straight away however.

It is possible to offer a lump sum to pay off your IVA however, full and finals depend on your monthly income so if you anticipate this will increase with you finding paid work it is unlikely that your creditors would accept a proposal which would see them further out of pocket when they could just take your already agreed monthly payments

UpToMyNeckInIt

Hi,

Firstly: Sorry to hear that you have been ill and I wish you a full and speedy recovery. Glad to hear that the IVA firm have been sympathetic with allowing payment breaks etc.

Having just completed my IVA, personally I thought it was a good thing, ultimately writing off C£24K of debt.

Unfortunately, as you know, an IVA is legally binding on all sides, so to an extent you are stuck with it.

However, you can offer a suitable 'full and final' settlement, (discuss with your IP) but this will have to be weighed up against what your creditors would otherwise expect to receive, if you allow the IVA to complete.

Regarding the rise in income clause: The '10% + 50%' rule is pretty common, and clearly set out in the IVA which you signed up to, so forgive me for not believing that this was a complete surprise. I'm sure you read that IVA proposal very carefully at the time.

However, I would not let that put you off going for a better paid job, (although I am not sure how this affects other things like benefits etc): This 10%/50% rule only applied to an increase in net income. However, the new job also means presumably more hours, and additional expenditure. On that basis, you could attempt to increase your 'allowances' to help offset any increase in IVA payments, (I am assuming that if you entered this arrangement on income-related benefits, your allowances will be based at the lower end of the allowed range). Your IP might be able to assist with this.

The whole thing gets further complicated if you formally declare your boyfriend as living with you: Firstly, whilst he is not going to have his income assessed by your IP, the fact that there is an additional income going into the household will get taken into account - not in a good way, in your expenditure allowances. Also, the second he forms any financial association with you, whilst you are insolvent, will hit his credit rating etc. as well. Personally, I would keep your relationship officially informal, until you complete the IVA.

Good luck.

sourcrates

Are you 100% certain it’s an individual volunterry arrangement you have ?

Because an annual review should be catered out yearly.

Do you rent or own a property ?

PrettyKittyKat

Annual reviews should be done yearly but if Op didn't respond then the IVA company would just report that no I&E review had been done in the annual report.

OP it is very important that you do an I&E update with your IVA company as your circs have changed. It may seem daunting incase an increase in disposable income is determined and your IVA payment is increased, however it only causes more problems in the long run. To get the best advice on how to proceed your IVA NEEDS your updated I&E. As another poster has said it is likely that your expenditures have increased, so maybe sure you updated these on the review, check your allowance - do you have sundries, hairdressing, dentist, entertainment etc.

You will also need to provide proof of incomes. This more complex being self employed as your accounts and tax return are done by tax year several months later. However as you say your business has been running for 3 years you should have 1 years, possibly 2 already.

Your priority needs to be getting all your information up to date asap with your IVA asap and getting better. Having an employed job would be more stable, yes you may need to increase your IVA payment if you income is higher however it would not be 100% of your increased pay so you would still be better off.

Craig1981

when on an IVA i changed job, gross income increased by 6K. my travel expenses increased, so did my wife's travel expenses (as were both working at same business park before)
childcare went up slightly as well.
did a new I&E with them when changed, approved, and i thing my payments, if i remember correctly, went from £360 to £366 a month - less than £10 a month increase.

that was the only time it changed throughout the 5 years. did the I&E review each year, with no further changes