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.
Included in this article:
- 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. All the creditors have to vote and the debt can only be added if 75% of the value of the voting creditors agree.
If a new debt is successfully added to your existing IVA you must expect that the original length of the Arrangement will be extended. Normally you will have to pay for an extra 12 months.
Struggling to get your head round all of this? We can help. Call us (0800 077 6180) or complete the form below. The advice is free and confidential.
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.
Struggling with your IVA. We can help? Give us a call (0800 077 6180) or complete the form below. The advice is free and confidential.
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.
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I have accrued new debts since getting my IVA. I can’t afford to pay them outright. 3 years of council tax arrears are mounting up. Now I’m worried about bailiffs coming round
Hi RoyM
Potentially it is possible to add debt to an IVA. However, having started an IVA, you should not now be struggling to pay your council tax. As such, I think there might be a bigger underlying issue with affordability. I think you need to have a good look at whether your IVA is still the most suitable solution or whether cancelling and using an option such as going bankrupt or a DRO would be better. These options would write off all your debt (old and new) and give you a fresh start.
If you would like to discuss this, please don’t hesitate to give me a call (0800 077 6180). The advice is free and confidential.