Is bankruptcy the only answer?

[debbie.s]

Hi everyone! Can anyone help? We are coming up for our second annual review. My husband had to give up work last March due to ill health and it is unlikely he will work again. I am making up the difference to keep up the IVA payments by working overtime, which has worked for the last 12 months. We have no assets other than a car, which I need for work. There is a possibility that my overtime could be reduced or stopped altogether in the future. If this happens we will not be able to make the full I V A payments. As we are only paying 31p/£ at the moment I am not sure how much less we could pay. There is a chance our I V A may fail during the next 18 months if I lose my overtime.We pay £900 a month. Is bankruptcy the only answer?

[melanie.n]

Hello there
contact your IP explain fully your circumstances and enquire as to whether your contributions can be reduced. Did you inform your IP when your husband gave up work due to illhealth year?

[debbie.s]

Yes our IP is aware of my husband finishing work. We wrote to her at the time. We have managed to make all the payments so far although sometimes a week or two later than due date. Will all my overtime count towards the payments? I don't think we had a 50/50 clause in our agreement. Some months I have earned more than my husbands income as overtime and sometimes less.

[Adam Davies]

hi
Your IP is the only one that can really answer this.
Hats off to you for keeping up your payments.
Bankruptcy will draw a line under your debts and leave you better off each month.
How much is your car worth ?
Regards

[debbie.s]

Our car is only worth about £1000 (at most). How much would we have to pay per month if we were bankrupt and how many years, is it two or three. If I didnt work any overtime our disposable income would be about £500.00.

[melanie.n]

If the car is worth around £1,000 you would be able to keep it. with regard to payments within the bankruptcy , it totally depends on your 'disposible income' bearing in mind your husband is no longer working, and benefits are not included in the income caluclation. Also, they look at 'basic' income not overtime. If, taking the above things into account there is still a disposible income you may be asked to pay 50% of it into the bankrupcy for a period of 3 years.

Melanie.n

[debbie.s]

In bankruptcy does the O R allow the same amount in expenditure as we have been given in our IVA or is it likely to be less?

[Skippy]

In bankruptcy only a percentage of your surplus income is payable to the OR. There is a table in my blog to give a rough idea of how much the OR will take, and I have also listed the differences in my allowances in my IVA and then in BR.

[debbie.s]

Thanks for your help Skippy13 and melanie. I don't think we will go down the bankruptcy route yet. I will see what happens at work with the overtime. Also my husband is due to go into hospital for electro cardioversion soon. If this works and I do lose my overtime maybe he will be able to do some part-time work somewhere .
Cheers!

[Skippy]

Good luck to you both, and I hope your hubby's treatment is successful x