IVA support and discussion thread
Options
Comments
-
Some very interesting points from you both DC and UTMNII, one point I was especially interested in was those who have very low payments into their IVA's which we are seeing quite of a few of these days.
When you get some that are paying only £100 per month on a relatively low payment of debt, I have to agree that perhaps they were not given the best advice of how to deal with their debts.
I also have to agree so much of it again boils down to the allowances and how there is not a lot of consistency with them - much like many aspects of the whole IVA process. Perhaps it is not morally right but I really do think people when entering an IVA should try to claim as much as they can from the outset so that any increases are manageable, especially as we hear so many stories of not getting replies from their IP or any reduction allowed without it being a major process to go through and as we all know bill rises don't wait for the IP to make a decision and can impact the financial situation of those in debt.
Wisdom comes from experience. Experience is often a result of lack of wisdom.0 -
...Another good post FTR. The whole thing you mention about allowances got me thinking:
DC - made the interesting point about the guideline clothing allowance being assigned a min. amount of £0: This I assume, means that an IVA can be considered a viable option, where the applicant feels they are not going to need a scrap of new clothing for the next 5-6 Years!!! Clearly, not a realistic option.
Setting a min. £0pcm guideline for sports/hobbies, mobile phone, sky TV etc. OK - that's fine - you can exist without those ...but for clothing? What on earth were Stepchange thinking?
It is guidance like that, which will only give further justification to some IVA companies to ensnare yet more of those people at the lower end of disposable income scale, and the more unrealistic the proposed budget, the more likely the IVA is to fail.
Then there is FTR's assertion that:
'people when entering an IVA should try to claim as much as they can from the outset so that any increases are manageable'
I stance that not only do I agree with (subject to not being stupid or fraudulent of course by claiming for a mobile, sky TV or children that you don't have for example!!!), BUT is also a stance taken by many IVA companies:
For applicant's deemed to have more disposable income, when they are flogging the IVA to you, companies will in my experience, make it a more attractive proposal, by going with the Stepchange 'max' guideline amounts.
My firm near enough maxed out my allowances at the proposal stage, a stance that I ensured continued come review time. Personally, I find that my family can live quite comfortably within these.
For other customers in a similar position I would hope that, providing they too are careful to properly revise their expenditure at annual review time - particularly to counteract any pay-rises etc, their IVA's are more likely to complete.0 -
With the allowances I am thinking that this is where making sure you research all the allowances before you consider an IVA comes in very useful. Fortunately having gone down the DMP route first I had claimed on quite a few things to make sure I had a reasonable budget so when the time came for swapping to the IVA, my statements showed exactly what my income was being spent on each month.
Again it does seem to be dependant on which firm you choose, it is good that your company were very reasonable in allowing the max for expenditure, but I do wonder if other people get such good advice. Many times you see how just a small increase in bills can mean people struggle to keep up with the payments during their IVA.
As for the allowances from SC, you do have to wonder just how much "input" there may have been from those that fund it and I do have slight concerns how much those allowances seem to form the guidelines for a lot of DMP and IVA companies, especially when you see a reduction in those allowances at a time when the cost of living is rising far about wage increases.
Just my own thoughts as per usual.
Wisdom comes from experience. Experience is often a result of lack of wisdom.0 -
UpToMyNeckInIt wrote: »...Another good post FTR. The whole thing you mention about allowances got me thinking:
DC - made the interesting point about the guideline clothing allowance being assigned a min. amount of £0: This I assume, means that an IVA can be considered a viable option, where the applicant feels they are not going to need a scrap of new clothing for the next 5-6 Years!!! Clearly, not a realistic option.
Setting a min. £0pcm guideline for sports/hobbies, mobile phone, sky TV etc. OK - that's fine - you can exist without those ...but for clothing? What on earth were Stepchange thinking?
It is guidance like that, which will only give further justification to some IVA companies to ensnare yet more of those people at the lower end of disposable income scale, and the more unrealistic the proposed budget, the more likely the IVA is to fail.
Then there is FTR's assertion that:
'people when entering an IVA should try to claim as much as they can from the outset so that any increases are manageable'
I stance that not only do I agree with (subject to not being stupid or fraudulent of course by claiming for a mobile, sky TV or children that you don't have for example!!!), BUT is also a stance taken by many IVA companies:
For applicant's deemed to have more disposable income, when they are flogging the IVA to you, companies will in my experience, make it a more attractive proposal, by going with the Stepchange 'max' guideline amounts.
My firm near enough maxed out my allowances at the proposal stage, a stance that I ensured continued come review time. Personally, I find that my family can live quite comfortably within these.
For other customers in a similar position I would hope that, providing they too are careful to properly revise their expenditure at annual review time - particularly to counteract any pay-rises etc, their IVA's are more likely to complete.
Hi
The SC reviewed clothing & footwear and other 'allowances' is becoming a bit of an issue and understandably so in mine and others opinions.
I thought the whole idea of independent impartial debt advice was more or less about the best interests of the debtor.
How can you start to tinker with allowances like this, what is the explanation? are we trying to make the figures or a solution fit? has to be a fair question in my opinion.
Are we trying to stop budgets going into defecit both in new assessments and reviews? are another couple of fair questions in my opinion.
Disposable income is of paramount importance when considering options both at the start of the advice procedure and during the life of a payment arrangement including reviews.
In a time when the sharp increase in the cost of living is all the rage headline wise then what is going on here/
How can you have an online Debt Remedy Tool that claims to give a solution in 20 minutes when it is based on these figures.
The CFS is used in DROs - the CFS is not used by Stepchange via their Debt Remedy Tool so how can this be accurate, now it appears that we have other changes in the allowance figures.
Just to balance what I am saying - I recently had a B/R case where a IPA was proposed involving a couple and two children - the clothing allowance was £160 per month, no problem - so how can you base accurate advice on the figures used by Stepchange?
When someone is seeking debt advice then they should be given full advice on all their options and sensible help and guidence with their budgeting as the whole arrangement be it an IVA, DMP, B/R payment agreement / order has to be affordable
realistic and sustainable and absolutely paramount that it has to be impartial and independent.
I happen to think the above points and questions are very fair indeed
Any comments, especially from Stepchange.
I will be putting more up later
My take on a subject issue that is set to run and run by the look of things0 -
Find_The_Real wrote: »With the allowances I am thinking that this is where making sure you research all the allowances before you consider an IVA comes in very useful. Fortunately having gone down the DMP route first I had claimed on quite a few things to make sure I had a reasonable budget so when the time came for swapping to the IVA, my statements showed exactly what my income was being spent on each month.
Again it does seem to be dependant on which firm you choose, it is good that your company were very reasonable in allowing the max for expenditure, but I do wonder if other people get such good advice. Many times you see how just a small increase in bills can mean people struggle to keep up with the payments during their IVA.
As for the allowances from SC, you do have to wonder just how much "input" there may have been from those that fund it and I do have slight concerns how much those allowances seem to form the guidelines for a lot of DMP and IVA companies, especially when you see a reduction in those allowances at a time when the cost of living is rising far about wage increases.
Just my own thoughts as per usual.
Hi
Another good balanced post again.
Just to add to UPTMNII's point about no clothing expenditure in an IVA for 5/6 years - what about 10 or more years in a DMP!!!
My take0 -
Hi DC,
Another very interesting post.
£160pcm clothing allowance for a family of 4 - that's really good!!! I know many solvent families who cannot allow themselves a budget that generous.
Difficult for me to comment further on the CFS figures, because those of us not working in the debt advice/management industry cannot access them.
But in summary, you are saying that CFS is on balance, more generous than the SC guidelines?
I also very much get the impression that, despite the IVA protocol allowing CFS or SC Guidelines to be used, IVA companies have their hands tied, and are in reality forced to use the SC Guidelines. Hence, why the all do so.
The cynic in me wonders if SC are deliberately eroding the IVA minimum allownaces, to make DMP's a more attractive proposition, thus preserving creditor return. Without a logical explanation, in the face of ever-increasing living costs, I am unable to think of an alternative reason.0 -
Hi
A logical explanation is what many of us are waiting for!
It really is astonishing, how can it be explained when you think about it.
They are in a right bit of a twaddle me thinks.
Come on Stepchange, lets be having you, its not going away, its going further a little birdie tells me:)
My take0 -
A little observation on cost of living:
I was recently pleasantly surprised: Renewed my Home / Contents Insurance - a whopping £200 cheaper than last year, and that included insuring my bikes 'all risk', meaning that I don't have to renew that £150 per year bike-insurance policy.
Incidentally, I was able to pay Monthly with AXA as well (this is not shameless advertising, but I know some IVA customers struggle to get Monthly insurance premiums, so listing IVA-friendly insurers can only help).
...and my Son cannot wait for the free meerkat toy!
Sods law I suppose: With energy bills and general living costs going up, the savings are probably going to go in one way and out the other.
Car insurance next Month: Anyone know which insurers definitely accept Monthly premiums for IVA-ers? Esure who I am with do, but with premiums reportedly going down this year, I am going to shop around.0 -
UpToMyNeckInIt wrote: »A little observation on cost of living:
I was recently pleasantly surprised: Renewed my Home / Contents Insurance - a whopping £200 cheaper than last year, and that included insuring my bikes 'all risk', meaning that I don't have to renew that £150 per year bike-insurance policy.
Incidentally, I was able to pay Monthly with AXA as well (this is not shameless advertising, but I know some IVA customers struggle to get Monthly insurance premiums, so listing IVA-friendly insurers can only help).
...and my Son cannot wait for the free meerkat toy!
Sods law I suppose: With energy bills and general living costs going up, the savings are probably going to go in one way and out the other.
Car insurance next Month: Anyone know which insurers definitely accept Monthly premiums for IVA-ers? Esure who I am with do, but with premiums reportedly going down this year, I am going to shop around.
Hi
That is some saving on the home insurance along with the bike insurance £350 per year total saving (£29.16 a month) if I have read this right.
Do they actually allow for a bike insurance policy?
Very tough times ahead, no doubt about it
My take:)0 -
UTMNII
I have had car insurance on monthly payments with One Call for most of IVA years and they fixed contract for 3 years so price stays same, not sure how premiums compare with the market at moment though. Might be option for you.
I do agree that any extra money does seem to come in one hand and then go straight out of the other :-) nothing changes there!!!
Enjoying reading your thread :-) hope it continues..........0
This discussion has been closed.
Categories
- All Categories
- 343.2K Banking & Borrowing
- 250.1K Reduce Debt & Boost Income
- 449.7K Spending & Discounts
- 235.3K Work, Benefits & Business
- 608K Mortgages, Homes & Bills
- 173.1K Life & Family
- 247.9K Travel & Transport
- 1.5M Hobbies & Leisure
- 15.9K Discuss & Feedback
- 15.1K Coronavirus Support Boards