After starting an IVA you may need to add an additional debt. Perhaps one was forgotten or you have incurred new debt. This may be possible but not always.
Jump to article content:
- Can forgotten debts be added to an IVA?
- Add a brand new debt to an existing IVA
- How to find out who you owe money to
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Can Forgotten Debts be added to an existing IVA?
If you forget to include a debt in your IVA it may be possible to add it later. If the debt is less than 10% of the total already included your Insolvency Practitioner (IP) should simply be able to add it.
However if the forgotten debt is larger than 10% a formal variation of the Arrangement will be required. The original creditors must accept the change.
They may not be happy to do so as it is likely to mean the amount they expect to be repaid will fall. If the variation is rejected the new debt cannot be added. You will then have to make other arrangements to pay it.
If a new debt is successfully added to your existing IVA you must expect that the Arrangement will be extended. This will normally be by 12 months.
Can you add a brand New Debt to an existing IVA?
It is possible for a brand new debt to appear during your IVA. One example of this could be a mortgage shortfall after a home repossession. Another is if you had a financial emergency and took a payday loan.
However the problem you then have is paying both your IVA and the new debt will be extremely difficult. You must therefore speak to your IP to see if it can be added to the Arrangement.
IVA Companies can often be reluctant to add new debts to an existing IVA. Even though you may be faced with having to fail the Arrangement because you cannot maintain the payments they may still be unprepared to help you.
If a new debt cannot be added to your IVA you need to consider your options. It might be sensible to to allow let your current Arrangement fail and start a new one or use a different solution.
How to find out who you owe money to
Given that a new debt cannot easily be added to an existing IVA it is important to remember and list everyone you owe money to before you start your application.
However this can be difficult. If your accounts have been passed between debt collectors or sold to a debt purchaser you may no longer know who is owed what.
One place that you can find a list of the debts you owe is your credit file. You should get a copy of your file and go through it. This should give you a good idea of who you owe money to and how much.
Your credit file is not a fool proof list of your creditors. However if you get a copy from two of the main credit agencies and compare them you should get a pretty good idea.
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