Final year of IVA ... 6 months left

[Jo1979]

Hi,
I'm hoping someone can offer some advice, I spoke with my ip this week as I have just got a part time job and was worried the extra income would effect my Iva. They told me that it's fine and that my final review was done last year and as such there would be no more reviews needed? Is this right? We are in year 6 due to equity clause etc but i was fully expecting a final income/expenditures review just before completion in August this year .... but my ip basically told me that whatever I earn now is mine to keep as long as I pay my last 6 months agreed payments... this seems too good to be true??? Thanks in advance for any views

[Foggy]

Normally a permanent pay rise isn't looked at until the annual review and any increase is effective from the month following that review. The extra between rise and review is all yours. Some IP's do try it on, but, it seems, yours is playing fair. They will briefly check for other extra income in the final year such as overtime and bonus payments, which are payable.

Not long now

[Jo1979]

Thank you for your reply! We are on the home stretch... the end is in sight I just don't want to do anything to muck it up! Ip told me catagorically that we won't have anymore reviews on our income/expenditure... i finding it hard to believe! It's been a long hard slog but my new part time job will make life just that little bit easier going forward!

[luluj]

I agree with foggy - your IP is being fair however I know how you feel.
If it were me I would ask for that decision in writing and if it wasn't forthcoming I would probably keep to one side half of your new income just in case ...
You are in deed on the home straight and hopefully by the end of 2017 everything will be cleared, certificate issued and you will be debt free fully !

[Imhotep]

I'm in a very similar situation.

We have six months left in our (almost 6.5 years IVA) and quite a large secured loan ends in three months.

I'm not sure if the three months 'spare' should be paid into our IVA.

[Foggy]

I'm in a very similar situation.

We have six months left in our (almost 6.5 years IVA) and quite a large secured loan ends in three months.

I'm not sure if the three months 'spare' should be paid into our IVA.

As this isn't a pay rise it isn't treated the same. Being a secured loan the repayment would have been allowed for in your expenses, so your income would not be increasing, but your disposable income would be. Such things as can be foreseen at the outset are usually written into the terms, so check there first. If not, you would be best to check with the IP -- he or she might not be bothered for the sake of three months .... but, then again, they might. You don't want to spoil the ship for the sake of a ha'peth of tar !

[Seanj67]

I too am in a similar situation.

My last payment is due in June this year, and my final review was done last year. Now, I'm assuming that come June, it will just close. Coincidentally I'm now about to start saving on travel costs, but as it's not an increase in income I haven't told them, as when I tried before they replied to say that they only looked at it come review time. It was the same with a bonus I got a few years back, I called to ask how much of it they wanted and they said none. Which was odd because the people I was transferred from wanted their share within 14 days.

[Foggy]

I too am in a similar situation.

My last payment is due in June this year, and my final review was done last year. Now, I'm assuming that come June, it will just close. Coincidentally I'm now about to start saving on travel costs, but as it's not an increase in income I haven't told them, as when I tried before they replied to say that they only looked at it come review time. It was the same with a bonus I got a few years back, I called to ask how much of it they wanted and they said none. Which was odd because the people I was transferred from wanted their share within 14 days.

Be wary of that bonus issue -- as they have, as you guess, treated it incorrectly. This might come to light at the final review and they will ask for payment then. Other than that -- yes, changes in I&E are usually dealt with at the annual review, unless you ask for an early review.

[Seanj67]

I too am in a similar situation.

My last payment is due in June this year, and my final review was done last year. Now, I'm assuming that come June, it will just close. Coincidentally I'm now about to start saving on travel costs, but as it's not an increase in income I haven't told them, as when I tried before they replied to say that they only looked at it come review time. It was the same with a bonus I got a few years back, I called to ask how much of it they wanted and they said none. Which was odd because the people I was transferred from wanted their share within 14 days.

Be wary of that bonus issue -- as they have, as you guess, treated it incorrectly. This might come to light at the final review and they will ask for payment then. Other than that -- yes, changes in I&E are usually dealt with at the annual review, unless you ask for an early review.

Yes, I did call them to ask about transferring the money, they initially said they only looked at it come review time, then when I got an email saying looking at the bonus amount it fell within my allowance and as such they didn't need any of it.Here's what they said " Thank you for your email. Please be advised that we conduct an annual review of your income and expenditure. If there are any increases in your contribution we will take this from the average over the last 6 months I have checked your payslips and we would not be looking for an additional payment in this instance, please keep us informed if there are any large lump sums that you have received as a bonus"

It's interesting that they average it over 6 months - I'm sure that wasn't the case with the last IP.

[Imhotep]

As this isn't a pay rise it isn't treated the same. Being a secured loan the repayment would have been allowed for in your expenses, so your income would not be increasing, but your disposable income would be. Such things as can be foreseen at the outset are usually written into the terms, so check there first. If not, you would be best to check with the IP -- he or she might not be bothered for the sake of three months .... but, then again, they might. You don't want to spoil the ship for the sake of a ha'peth of tar !

I've spoken to our IP and they have suggested that we settle our IVA early with the first month of non-secured debt freedom.

Sounds like a plan.

[Foggy]

As this isn't a pay rise it isn't treated the same. Being a secured loan the repayment would have been allowed for in your expenses, so your income would not be increasing, but your disposable income would be. Such things as can be foreseen at the outset are usually written into the terms, so check there first. If not, you would be best to check with the IP -- he or she might not be bothered for the sake of three months .... but, then again, they might. You don't want to spoil the ship for the sake of a ha'peth of tar !

I've spoken to our IP and they have suggested that we settle our IVA early with the first month of non-secured debt freedom.

Sounds like a plan.

Cool

[rke3215]

Hi All, sorry to hijack this thread, but I am also at the last 6 months of my IVA and unsure about what to do next...

My IVA was 60 months, with 6 months at the end for any outstanding payments (overtime, missed payments, etc). I am at month 54. I have missed 2 payments with IP permission, for emergency purchases, so expect these to be added as payment 61 and 62. There is an equity clause on my house.

My initial debt was £30,000. To date I have paid £28,000 into the IVA. At 60 months I will have paid £30,700, and with two outstanding payments, £31,600.

My IP now informs me that to cover overtime, and a PPI claim sent direct to me by mistake, they expect me to pay another 4 payments bringing the total to 66 payments. This brings the total repaid to some £33,400.

After my last annual review (6 months ago), my surplus was set at £420 but my repayments set at £457 (the max according to original agreement). I still haven't received a reason for this despite various requests, and find email replies to be quite hostile. I have requested exact figures for the outstanding amounts owed to each of my 6 creditors.

I am really struggling to make payments at the moment, and with car and house repairs desperately needed, think it unlikely I can make another 12 payments at this level. 6 payments, probably. Communications with my IP seem to have broken down somewhat.

So, my question is.... What is my best course of action?

I am thinking of defaulting, saving my monthly payment and letting the IVA fail, then trying to make a payment plan direct with each creditor over a longer period thus lowering my monthly outgoings and saving the IP management fees. Is this possible, or wise?

My second thought is missing 2x payments so the IVA doesn't fail, and using this money to tide me to the end. What happens at the end of 66 months if 2 payments are missing?

Many thanks, Richie..

[Foggy]

I would strongly advise AGAINST allowing the IVA to fail. Your creditors will then be able to add back lost interest and late payment charges and you could find that all you have paid so far will have been wasted. You will not circumvent IP fees -- these have already been taken on an ongoing basis.

As for missing payments -- if your IP agrees to a break, this will be added on, again, at the end. If you simply miss two, without agreement, the IP can fail the IVA as you are already in arrears, so these two misses will tip you over the edge.

[Michael Peoples]

I agree that failure would potentially be a disaster. Check your paperwork as usually your payments can be reduced by 15% without the need to get permission of creditors nor is the IVA extended. This would seem a suitable option for you.

[rke3215]

Thanks Michael and Foggy. I will keep trying to get my IP to reduce the level of payments to my surplus, but they don't seem very interested at the moment...