A reader has asked:
My husband has an IVA which we pay every month. Now the kids are off school because of coronavirus and a friend will be looking after them for a charge. Will we be able to reduce our IVA payment?
Many people with IVAs will be very worried about their finances. Their income may have fallen, possibly to nothing because of coronavirus. Or they may have extra expenses.
Not everyone has the same terms on their IVA, but most will provide for people to be allowed some payment breaks.
See What happens when you can’t afford IVA payments for the normal situation when you have difficulties in an IVA.
Ask for help
These are not normal times. Your IVA firm and your creditors will not want your IVA to fail because of a temporary Coronavirus problem.
As Kathryn Maclennan, a solicitor specialising in insolvency, says:
If you are currently in an IVA with your creditors and you cannot maintain your income payments due to COVID 19 speak to your Supervisor.
It may be that there are provisions within your IVA which will allow you a payment break or a reduction in the monthly amounts due. If there are no existing provisions which will help you then your Supervisor can convene a meeting of creditors to allow the necessary adjustments to be made to allow your IVA to continue and avoid a breach. Even if these changes are just for the short term it will help.
The message is not to panic but to act. If you are concerned about your ability to pay, contact your Supervisor as soon as you can to explain your position and how you can work through this.
So the reader who asked about new childcare costs may want to have the IVA payments reduced to cover the new costs. Or if the costs are larger than the current payment, a payment break may be needed.
IVA firms are expecting a lot of calls
I have spoken to a couple of IVA firms today about how they will be helping clients. I think most other IVA firms will be similar.
Creditfix has advised that they remain open as usual to assist their clients. Telephone lines will be open from 8.00 a.m. to 8.00 p.m. (0800 0431 431) and clients can also contact them by email at customerservice@Creditfix.co.uk.
Creditfix anticipate demand to be higher than usual and would encourage as many clients as possible to use the client App if they have it and would ask clients to be patient if they cannot get through on the phone straight away and bear in mind that their own staff will also be affected by the current Government guidelines.
Payplan say any clients who are struggling to pay should contact them through the normal channels so they can try to support you through this period with reduced payments or payment breaks.
Payplan staff are now mainly working from home but they can access the case management systems and e-mails. Their telephone systems also work remotely and so they expect to be able to maintain broadly normal services for the foreseeable future. Some staff are having to work unusual hours to accommodate childcare requirements etc so if you are phoning and don’t get through straight away then please either try again later or message Payplan and they will get back to you.
Call even if you are not sure how much you can pay
Many people will be in a very uncertain situation. You may not know how much you will get through the benefits system. You may be trying to get a mortgage payment holiday arranged as well. No-one knows how long this is going to last.
But start the conversation now with your IVA firm.