Getting out of an IVA?

[kellysangels1]

Hi,

I have an IVA which I have been paying for the past 3 years or so and haverecently heard from the Debt Management company that my IVA will not be complete until 2010 even though it is for 5 years. The reason they gave is becasue it took 2 yesr for the stupid thing to go to court...can they do this? How come I agreed a 5 year contract with them and now they are saying it is 8 years?

I am desperately looking for a way to get out of this contract, either by loan or something else(not quite sure yet)

Can anyone give me any advice?

Thanks
Kelly

[gizmo111]

What does it say in your original IVA agreement. Have you discussed this with your IP?

[Jimbo44]

Originally Posted by kellysangels1

Hi,

I have an IVA which I have been paying for the past 3 years or so and haverecently heard from the Debt Management company that my IVA will not be complete until 2010 even though it is for 5 years. The reason they gave is becasue it took 2 yesr for the stupid thing to go to court...can they do this? How come I agreed a 5 year contract with them and now they are saying it is 8 years?

I am desperately looking for a way to get out of this contract, either by loan or something else(not quite sure yet)

Can anyone give me any advice?

Thanks
Kelly

I may well be wrong, but I was under the impression an IVA didn't begin (and payments under it therefore not needed) until it had been approved by the court and until it had been approved by a stated majority of your creditors.

Just a question, though. You say you've been paying for three years and I assume (hope) that money has been going towards the 'IVA pot'?

[kellysangels1]

Originally Posted by Jimbo44

Just a question, though. You say you've been paying for three years and I assume (hope) that money has been going towards the 'IVA pot'?

That was my question to them and they said that the money that I was paying prior to teh court date was for charges, But in the first letter I received from them the charges are stated at £550 which i have/had paid well over that as I have been paying over £250 each month

The company I am doing it through do not respond to any letters or phone calls, they are the worst company I have ever had dealings with and wish I had been able to sort it out myself!

I'm tryign to arrange a meeting with my bank manager to see if there is anythig they can do!....I hold little hope though!

[kellysangels1]

Hi everyone I am looking for some advice on my IVA.

I have been paying a company since October 2004 to sort out my finances and it has all gone ok (i've stopped getting calls and letters from creditors) which has made my life much easier!

For some reason I decided to get my paperwork out the other day and take a look at it and I have come across a few things which don't make sense to me!

1. IVA's are for 3-5 years, but according to my company it will not be settled until 2010 as the case only got taken to court in 2005? So what happens to the first year and a half's money? According to them it's there fee, but I payed £250 up front (which I was told was there fee!! thast almost £3000+ that has gone missing??)

2. They give you little free money for christmas and birthdays and if you phone them up asking to minimise the payments for 1 month they make yoi feel so little that they canstamp on you, so again...they make you struggle!

I havereally had it with this company. I would advise nobody to ever get an IVA out as although they do stop the phone calls, they rip you off something cronic!!

I'm really looking for a way out at the moment so any advice would be brilliant, thank you!

Kelly

[i_spam]

Speak to the citizens advice . they should be able to help you. I have never been involved with a iva so havent got a clue about what it is !!!!

[Karnevil]

Which company are you using kelly ??

Many of these companies, as you know, charge extortinate fee for administering IVAs. Let us know who it is and we can have a look, and maybe someone else who has used them will know how they operate.

[gizmo111]

Kelly are you sure this is an IVA not a DMP as I am not aware of any IVA that changes monthly payments or gives you a xmas holiday.

[Gingerheid]

Why did it take two years for it to get to court? Were there negotiations with reluctant creditors / rejected proposals....

If there is a legitimate reason for the delay then technically there is no reason why you shouldn't have been paying what you could to your creditors until the IVA was finalised, so you would not have technically have suffered a loss . (I take it the creditors did see the money??? )

I can only think of two ways out an IVA, but for the ways out yours you would need to read the agreement you have. There is always however bankruptcy on the supervisor's petition if the IVA fails, and sometimes something like a payment for example from the proceeds of the sale of the house the IVA was designed to protect, or some other way.

I'm not sure what payment from some other way would be though, as the IVA agreement probably gives your creditors entitlement to their paws on any windfall you come by during the duration of the agreement.

I'd be amazed if anyone would give you a loan while you had a current IVA.

[bill-k]

Hi Kelly,

Gizmo mentioned your thread to me. I am in a Trust Deed, which is a Scottish IVA, so there are differences. But I have been asking around, as I now find myself unable to acquire any lump sums of money without "losing" it straight away to the creditors. I have asked around, and so far the stuff I have found is this:

The admins of an IVA can be an obstructive bunch, and often seem hell-bent on keeping you in the dark and feeding you $h1t. Not sure about IVA mechanics, but a Trust Deed is taken out with an Insolvency Practitioner, who inhabits some ivory tower, defended by the admins. If you can directly contact the IP, they can often be most helpful, if you're honest with them. One contact of mine regularly telephoned his !!

As Gingerheid says, getting a loan is going to be nigh on impossible, unless you take on a doorstep loan shark, I reckon. And of course that would NOT solve anything. Getting a "cash" loan from friends & family seems the only way that the "loan" route can work. And be very careful here, too. If you manage to get enough cash together, do NOT tell your IVA admins that you have got it. If you can get fam/friends to help you, get one of them to act as your "benefactor." THEY then tell the IVA admins/IP that they can pay the balance currently owing on the IVA, on your behalf, ON THE CLEAR CONDITION that it discharges you from the IVA. Basically, "paying off" an IVA early gives the creditors their agreed amount of money early (eg., 20p in the £, which is 20% of what you originally owed them). It is an advantage to them to get this earlier than they would have, so it should NOT in theory be a problem. But, it seems that IVA providers are just damn lazy, and will not help you do this.

As far as I know, there is nothing to stop you approaching your creditors yourself, and explaining what it is that you are trying to get your IVA admins to do. Chances are the admins haven't told them a bl**dy dickie-bird about your proposals, so if YOU tell them, then you might get them on your side with this, and THEY will start telling the IVA admins what THEY want. I should point out that this is something I considered but have NOT actually tried, so it is all theory so far. Don't directly offer your creditors any money, though, as this will be acting outside of your IVA terms, I'm sure.

The time it took for the IVA to be agreed, and the "fees" you were charged certainly doesn't make me feel that your IVA provider is one of the "good guys." Try being straight with the IP him/her self, first of all, and see if you get anything positive or helpful. Read between the lines of what you get back from them, and if it doesn't seem too good, then consider contacting the creditors (make sure you contact ALL of them, and get a written response from ALL of them). Try and get the creditors to ALL agree with you that they would prefer to get their money now, rather than later, and that the only obstruction to them getting it is your IP. Then you might be able to get them to force the IP to have a creditors' meeting, and they will "force" the IVA to accept your "friend's" offer of an early settlement. I stress this is theory, but it makes sense to me. The only reason I have not done this is that I just have a coupla years of enforced "poverty" to go with my TD, and it seems less hassle to let than run its' course, than to contact all our creditors, etc., etc., etc. In your case, though, it looks like the hassle may be worth it.

Sorry if all this seems like reading "War and Peace." Please step back, then go back over it again slowly, so that it starts to focus. Then do it again. Hopefully, there's something in there to give you a plan of action. But be polite, yet firm, with your IVA admins., and polite with your creditors. Your creditors have accepted a reduced amount of what you owed them, so appreciate that. But if you can offer them that amount NOW, rather than in several years' time, then you are offering them something BETTER than what they originally settled for. They might not be grateful for it, but they should prefer that, and if the IP doesn't pass that on to them, then by telling them that is what you offered the IP, you should get them all on your side.

But stay polite and genuine all the way (not easy with these $0d$, I KNOW !!). Remember that you're still dealing with people like yourself, behind their facade, and it's amazing who you can get on your side, sometimes, if you speak with your heart AS WELL as with your head.

I hope that has given you some food for thought. Don't choke on it - chew it slowly !!! But please post back here and tackle me on anything I've said that doesn't make sense. Keep my opinion out of it, and try and form your own opinion, from what I have been able to tell you of my experience so far.

Hope that helps, my friend !!

Bill.

[7givenchy]

Hello Bill

I am also in a Trust Deed which I entered in June 2005 - shortly after this in July 2005 I was forced to resign from work due to serious health problems (heart ,diabetes, thyroid). I have struggled to pay the £100 towards my trust deed as I only receive basic incapacity benefit. I wrote to my IP in July 2006 informing them of the change in my circumstances and asking for advice. I explained that I was eager not to break the contract I entered into with them, however I received no reply and I have continued to pay. It has got so bad my family are now supporting me.

I recently successfully claimed back £1200 in credit card charges from Halifax Bank of Scotland which I hoped to use to continue to make my payments. HBOS credited the sum to my account which has been closed for 18 months. I contacted them informing them that I am in a Trust Deed but they said they were keeping the money.

I contacted the IP office 2 weeks ago to inform them that my claim had been successful but the bank would not refund the mony. I was asked to send all revlevant documents I sent copies of Summons and letters from HBOS. I enclosed copies of letters from consultants etc to verify my state of health. I have had no reply. I would be most grateful for any suggestions about how best to proceed.

[bill-k]

Hi 7givenchy, I just saw your post here. I have to go out now, but will get back to you about this. I don't know yet if I have anything that will help, but I have also had that problem where they pay it into your closed account. I am fighting this move at present, so we have a common cause here, if nothing else.

I will get back to you later.

Bill.

[Gingerheid]

Someone else might know better, but my gut reaction would be that they would have a valid right of set off that they could exercise, and that the correct procedure would be for them to reduce their debt and tell the IP about their revised claim in the arrangement.

I fear the money was never heading your direction at all I'm afraid - if they had paid it to you then you'd far more than likely have had to pay it to the IP in addition to the monthly payments anyway.

Not getting a reply is unsatisfactory though - make them reply!

Edit on seeing Bill-K's post: 7Givenchy's problem is more deep rooted than the bank exercising a right of set off - their main problem is that the right of action against the bank was an asset they had at the time of entering into the arrangement, and that on top of this any payout they receive is a windfall that most IVA arrangements are robustly enough worded to snaffle. I would presume the Scottish arrangement is sufficiently similar, and that 7Givenchy would have to struggle to get the money not just out the bank, but past the IP as well.

* Disclaimer... I am thinking English Law not Scots Law. I know nothing about Scots law.

[7givenchy]

Hello All

Many thanks for your swift replies!!

It was always my intention to inform the IP if my claim was successful and I was aware that they would probably use the money to offset my debts.

I thought however that as my financial circumstances had changed considerably and that I was no longer in employment they might consider
using the proceeds of my claim to offset my payments to the trust deed.

As far as I remember one of the conditions of the trust deed was that the person was currently in employment and on entering the deed the IP drew up a statment of Income and Expenditure leaving the person in the deed with basic living expenses. As previously stated I am no longer able to work and I am currently in receipt of £317.00 per month Incapacity Benefit. I pay £100 towards my deed and I am left with £217.00 per month to exist as a result of this I am being supported by my grown up children. and have attempted to discuss the situatution with the IP without success

I had a long chat with one of the legal team at HBOS regarding my claim, the young man concerned was sympathetic to my situation and I
in turn could fully appreciate the banks postition, but wonder what the legal position is.

Regards!!!!

[Gingerheid]

Sorry - I only answered one of the questions!

With an IVA if you don't make the payments it 'fails' and the supervisor petitions for your bankruptcy. I presume a PTD is the same? The agreement might provide that creditors can agree a change... it's best to have read at it, or phone and make them answer you.

[7givenchy]

Hi Gingerheid

Thanks you for your advice - in the morning I will read carefully the small print in the deed. I appreciate the point you are making. I may have overllooked this. I am eager to continue with the deed if possible at a reduced rate of payment

Sandra

PS There are so many "gingerheids" in my family I am almost one and my son is a fully fledged "gingerheid"