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What if my circumstances change during my IVA?
An Individual Voluntary Arrangement (IVA) is a debt solution available in England, Wales and Northern Ireland. Debt advice in Scotland involves similar but different solutions. Before considering an IVA as a debt solution, please make sure you fully understand the risks involved. Please visit our website for more information.
Things may change
An individual voluntary arrangement (IVA) is a five or six year commitment (unless it’s a lump sum IVA).
That’s a fair stretch of time in anyone’s life and as we know over time, circumstances can change.
We’ve already blogged before about when you need to call our IVA company; there are a number of reasons to pick up the phone straight away – redundancy, pregnancies, relationship break ups, or even if you’ve had an unexpected windfall.
But what can we do to keep your IVA running if something unexpected occurs?
Life is what happens…
While you’re busy making other plans life has a way of surprising you with sudden, unexpected changes. Some of these changes can have a positive impact, others less so. If you’re on an IVA you really need to know where you stand regards your finances for five or six years.
If things do suddenly change and these changes will have an impact on your IVA you need to contact us as soon as you can. However, just because you’ve suddenly lost your job or suffered some sort of income shock, it doesn’t mean that your IVA will automatically fail.
Things we can do
Your Insolvency Practitioner has a number of things that they can try in the event of something going wrong.
Some of these powers can only be effected with the agreement of creditors, but your IVA supervisor can make variations to your arrangement to take into account any changes in circumstances. It’s also sometimes possible to propose payment breaks or extensions to IVAs if circumstances dictate.
Sometimes creditors may not agree to such changes and with variations to existing IVA agreements creditors will be allowed to vote on the issue again. But you can rest assured that we’ll do all we can to make sure that your IVA remains a sustainable long term solution.
The 5 questions
We’ve also discussed the 5 questions every IVA client asks and again these can include queries about additional income, creditor contact and interest on debts.
Recently we’re also getting asked a lot about reclaiming mis-sold PPI while on an IVA. Of course you can reclaim but you should follow our guidance to make sure you don’t pay a fee for it.
Annual Reviews
Your annual review will take into account a lot of the general changes that have happened to your budget over the last 12 months. If it’s a large change in circumstances you’re better contacting us prior to your review.
What if there is an extreme change of circumstances?
If your change in circumstances is so extreme that it means your IVA cannot continue under its current terms please get in touch with us to discuss other options available. We may be able to get your creditors to agree to vary the terms of your IVA so that you are able to successfully complete your IVA with an affordable payment.
We’re part of the UK’s largest debt charity and we’ll take steps to make sure we work with you to deal with any change in circumstances.
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