I feel stuck!

jaylabrum

Sorry if this is the wrong place I just don’t seem to know what to do, 

I’ve sought advice from different places - basically I owe around £7.5k in total, £3500 is council tax arrears , it was £5000 but I’ve been paying £200 a month through debt recovery company and I feel I’m constantly playing catch up as once I’ve paid one years worth the next years gets added on top and I just can’t seem to catch up , 

the rest is in other debts, 

recently I was contacted by a council in a different part of England I lived in about 6 years ago for an apparent benefit over payment around £1900 , I have never heard from them until this year only when they put an attachment of earrings on and took over £600 from my salary in which I couldn’t even afford my rent , I contacted them and said this was not an over payment and provided them with wage slips from that year to show what I was earning , they’ve told me this will be looked at but it could take months , they’ve agreed to a 60 day period to not take the attachment but knowing it’s coming to an end soon and my salary being unable to afford things again is causing me a lot of stress , I’m also annoyed as I had a DRO in 2020 and as I didn’t know about this I could have included it at the time, 

so I initially went to payplan and applied for an IVA it was rejected , my current council apparently said it’s their policy they don’t do IVAs so they rejected it and as they have the biggest debt it was denied, I have recently tried again with Mccambridge Duffy , my meeting is coming up and I’m concerned it will go the same way, I have tried contacting the council to explain my reasoning as to why I am applying but no reply  , one company have already emailed me personally to say they have rejected it as it’s not in my best interests and to seek debt help which is what I have already done so that doesn’t make sense to me , 

Although I am adamant I do not owe this overpayment I can’t wait months to be reviewed as I can’t afford to live when they start taking the attachment again, I have included the debt on the the IVA though , 

I’m just worried if my IVA is rejected again is bankruptcy something to do as the majority of the type of debt I have can’t be included in a DMP , I feel really stuck at the moment 

fatbelly

You were able to get a dro in2020 as you were not a homeowner.

Unless that has changed, I can't see why you are messing about with ivas.

Bankruptcy would give you a clean restart but there is an upfront fee of£680

If the benefit overpayment was classed as fraudulent it would still be payable however

StepChange_Aidan

Hi,

I’m sorry to hear about your situation.

For an IVA to be approved, the proposal needs to be accepted by 75% of your creditors (by value). This means that if one creditor owns more than 25% of the total debt, they can prevent the IVA from going ahead. 

As Fatbelly and one of your creditors has pointed out, it seems that an IVA may not the best option for you. If you have no assets to protect, then potentially bankruptcy to just write the debts off could be more suitable. 

There’s some more information about applying for bankruptcy here.

Is this a Housing Benefit overpayment or from another type of benefit? If you’re certain that you don’t owe this debt, I’d contact the council to ask that they can keep the wage deduction on hold for now while this is being investigated. 

Councils have the power to reduce or stop deductions from income if you can show evidence that this is causing you serious financial hardship. If they refuse without giving a good reason you should make a complaint.

Before you decide on what to do next, I’d recommend getting full independent debt advice. If you’d like to get help from StepChange you could use our online tool or give us a call to speak with an advisor.

Regards,

Aidan

jkepple

Despite doing everything by the book, council muppets still said there was an overpayment.
They only stopped faffing around when I wrote to my local MP, who wrote to them to investigate. 
Amazing how quickly they responded when a Houses of Parliament stamped envelope arrives on their doorstep.
Anyway it turned out it was their fault and got out of it.
Maybe try that?