Deductions

Binky55

I have roughly £5,600 in debt store card , phonebill,utilities things like that. I sorted out and got agreed an IVA which was set at a reasonable amount. Due too financial issues I’m now in arrears and there saying IVA will be terminated and the creditors will take it from my benefits!! Are they allowed too do this? 

Sonic101

Hi there

it sounds like you’re dealing with a dodgy IVA firm, not least because you’re in an IVA for only £5600 of debt - unless you have an asset to protect?

Your creditors can’t just deduct money from your benefits unless they’ve been through the courts and it’s been ordered by a judge.

There are quite a few helpful people here but I think you really need to contact a reputable debt charity for advice. Try StepChange (https://www.stepchange.org/) or National debtline (https://www.nationaldebtline.org/) 

Come back and let us know how you get on.

RAS

Binky this is dreadful. 

IVAs are for people with a house or other assets to protect and at least £30K of debt. But they earn the providers some nice fees which motivates some to offer them when they are not the best option.

Right now the BEST thing you can do is to stop paying anyone and stop speaking to the IVA provider. That will allow you a bit of space and you can use the money you're not paying to build up a little reserve, as you really do need one.

The only debts that are important are Council Tax, rent, fines and your current utility suppliers (not old ones) and these days I suspect your phone company.

If the IVA provider contact you, try to record the conversation. Otherwise, tell them the IVA was mis-sold and you are taking advice, so they are not to phone you again. They are to write.

Speak to stepchange or National debtline.

It will take a little time for this to come out in the wash, but there are other options including a Debt Relief Order. Just you need to stop paying the IVA so that you can take advantage of them.

No-one can take money from your benefits without a court order and you are a long way off that. First the creditors will have to get a CCJ (most won't bother), which will set you affordable payments (£5 a month possibly). If you keep up with those, no-one can touch your benefits.

fatbelly

There is no facility for a creditor to deduct from benefits (exception is credit union) - even a ccj cannot be enforced that way.

I agree with the others - the IVA was missold. Let it terminate, see what crawls out of the woodwork and consider a DRO if needed.

(IVA mis-selling is now an epidemic. It would be nice if the government took an interest in this)

https://debtcamel.co.uk/iva-mis-selling/

sourcrates

Absolutely shocking granting an IVA for such a small amount of debt, you were very, very badly advised here.

I too say let it fail, your dodgy IVA company is worried they won`t see their fee`s if you fail the arrangement, so have resorted to underhand threats, no one can deduct money from your benefits except the DWP to pay certain utility bills if the claimant fails to do so, and only then under certain circumstances.

I would also be tempted to lodge an official written complaint about your IP`s conduct here.

RauHughes

fatbelly said:

(IVA mis-selling is now an epidemic. It would be nice if the government took an interest in this)

https://debtcamel.co.uk/iva-mis-selling/

Give that the new IVA protocol specifically states it is highly unlikely an IVA is the right solution if the debtors income is solely benefits based, the FCA are preventing debtor packaging firms from recieving commission for 'selling' IVA leads to IPs and the insolvency services has issued notice to IPs reminding them if they can only act in an advisory capacity if there is a reasonable assumption they will take an appointment - I'd say that the government is taking notice and trying to improve things. Finally!!

Let's hope there is improvement and people like the OP aren't being forced onto solutions for profit in 9ur near future!!