Naively have landed myself in a pickle in relation to my IVA

sourcrates

If your income increases during the term of the IVA, then yes, your payments rise also.

Its quite possible that you can repay the full debt owed, plus fee`s, with nothing written off.

Creditors can`t re-add interest previously frozen, a default on a debt is a line in the sand which cannot be altered or changed, once defaulted all interest and charges cease to be applied, whether in an insolvency arrangement or not.

If your IVA was failed, the debts in it would be sold most likely to 3rd party buyers, who would have little or no knowledge of events prior to them purchasing the debts.

Unfortunately, like so many people, you entered into a debt arrangement you didn`t fully understand and this has been the result, fatbelly has listed your options, and to be fair, I`m not sure which one I`d go with either, but I think I would lean towards letting the IVA fail, and dealing with the debts at a later date, you were only 7k in the hole, I would say with some tactics, skill, and a little luck, you could settle the lot for half of that down the road.

thefox180

sourcrates said:

If your income increases during the term of the IVA, then yes, your payments rise also.

Its quite possible that you can repay the full debt owed, plus fee`s, with nothing written off.

Creditors can`t re-add interest previously frozen, a default on a debt is a line in the sand which cannot be altered or changed, once defaulted all interest and charges cease to be applied, whether in an insolvency arrangement or not.

If your IVA was failed, the debts in it would be sold most likely to 3rd party buyers, who would have little or no knowledge of events prior to them purchasing the debts.

Unfortunately, like so many people, you entered into a debt arrangement you didn`t fully understand and this has been the result, fatbelly has listed your options, and to be fair, I`m not sure which one I`d go with either, but I think I would lean towards letting the IVA fail, and dealing with the debts at a later date, you were only 7k in the hole, I would say with some tactics, skill, and a little luck, you could settle the lot for half of that down the road.

Thanks for your knowledge and assistance on this matter. I froze my card and moved any funds into a separate account this morning as my payments are due on the first of each month. I believe I need to miss two more payments before my agreement will fail.

I’ll be honest I’m filled with anxiety over how things will move forward from here but I guess only time will tell, I’ll ignore any calls I get and keep all funds out of my account until I receive confirmation of termination.

I trust you know what your talking about it’s just unsettling when I read things like this; 

• If you end your IVA by stopping payments to your supervisor this can have a really significant impact on your debt and make your position worse. You should never do this without consulting your IVA supervisor.
• IVA failure can be costly. If your IVA fails, creditors can add interest and charges that built up while the IVA was in place and they would be free to take enforcement action, for example by making you bankrupt. As there are fees to pay in an IVA.
  

As you’ve mentioned some of the larger debts have been purchased by debt recovery companies. One of them has details on their website that they do not charge interest and that I can pay back my debts at a rate that works for me. A good while back in June they emailed me whilst I was in the IVA offering a settlement figure that was considerably less than what I owed. Is it better for to attempt to pay back my debts in full or try to pursue lower settlements?

thefox180

After deciding not to make the IVA payment on the 1st I can’t stop ruminating over whether it was the right decision and whether it’d of been simpler/wiser to continue making the payments. It’s causing me a lot of stress and I just go round in circles in my head over the issue. Can the companies who have purchased my debts add interest to them? There is so much conflicting information about this online. I’m so lost and confused over what is going to happen from here.

fatbelly

Generally the answer is no. The debts have been defaulted and sold to debt buyers at a hefty discount so they just want their profit by pursuing you for the full balance

If you were still in an interest-bearing contract, that the IVA froze, then terminating the IVA could make you liable again for the interest. But I've never known it happen.

I thought you said last week that you were going to carry on paying?

sourcrates

There is a duty to make you aware of what potentially could happen if your IVA fails, that doesn't mean any of those things will happen.

99% of the time, a few months after your IVA has failed, you will start getting letters from debt collectors.

As for bankruptcy, that would only be a possibility if your home had a great deal of available equity in it.

I agree with fatbelly you do need to pick a strategy and stick to it.

thefox180

I made my payment for November after initially withholding it for around 6 days, I had second thoughts around whether letting it fail was the best course of action. my IVA is still active and I haven't been issued any notice of breach, I was informed that it would take 3 months of failed payments for me to be issued with a notice of breach. I have not responded to the inquiry in relation to my savings (which as mentioned are no longer openly available to myself) to the best of my knowledge this hasn't been read into any further and hasn't been followed up past the initial inquiry. I was informed the increase in my payments from £100 to £128 will start from December. I'm going to do my tax return for 24/25 and send them a copy of it when it is available. At which point a new income and expenditure report is likely to be processed. 

I'm thinking that the company I'm in the IVA with are only concerned with getting their fees paid in full, with 44 months left on my agreement it is very likely that I will end up paying the total of debts + fees, this is something that I'm okay with as the expenses are so spread out it's not overly problematic. If I continue to make my payments I'm assuming it's unlikely anything will go wrong with the arrangement and will just complete in time. If it fails further down the line then I'll have more money available at that point to pay of the debts with full and final settlements. Strange situation and maybe I'll end up wasting money on fees for no real personal gain but at-least I am buying more time to try and clear this issue up.