Are payments fixed during an IVA?

IVAs help the debtors in discharging off their liabilities to their creditors by offering to pay monthly payments based on their current income and expenditure.

Usually, this amount if fixed and it is worked upon by the Supervisor, after consulting the creditors. But in some cases this amount is likely to change.

Some factors responsible for the change in IVA payments are:

  1. Changes in the cost of living.
    If the debtor’s cost of living undergoes a change during the IVA then changes can be made in his monthly installments.
    Suppose the cost of living of the debtor falls then it would be demanded on his part to contribute more to the creditors because of this fall. It may also be possible that during the IVA some of his liabilities end like the ending of a hire purchase agreement. Such a thing calls for an increase in the monthly payments.
    On the contrary if the income of the debtor has fallen then provision can be made for a reduction in amount of the installments.
  2. Changes in income of the debtor.
    Since the IVA extends over five years usually, it is likely that the income level of the debtor may change during this period.
    Any rise or fall in the income can be made to reflect a corresponding change in the IVA.
  3. Extension of IVA payment period.
    If the term of the IVA is increased for some reason such as if the debtor goes on a holiday, then the monthly installments are also expected to change.

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