Debt Free Direct Over Calculate Income!!

A question about : Debt Free Direct Over Calculate Income!!

Been in my IVA now for 3 years with Debt Free Direct.

This year however, there has been a problem.

I receive per calender month Ј888 in benefits.

This include DLA and cont based support group ESA.

However when DFD calculated my income they claim I physically receive Ј967!!

But when you look at the bank statement the monies go into, it add
up to Ј888!!

They have up my payments from Ј130 to Ј175; I am worried I will struggle to pay this amount of money each month!!

I've had to complain to the Financial Ombudsman Service today over the matter, I dont like complainang as a rule but DFD eare not listening to me!!

I have offered to increase from Ј130 to Ј150 and that Ј150 is all I can afford.

DFD has not replied to my email.

I am very frustrated; I thought an IVA was supposed to be affordable!!

Feeling angry!!

Best answers:

• Your benefits are weekly not monthly, your Ј888 is a 4 week figure not a monthly figure.
• Bad news I am afriad, your complaint to the Financial Ombudsman is very likely to be returned as not within the FO's jurisdiction.
  As I understand it, anything an IVA does in the role of being an IVA is excluded from the Financial Conduct Authority regulation and the FO is not the relevant ombudsman. Instead you will have to complain to the body which authorises your IP.
  There is more about how to complain about an IP here: https://debtcamel.co.uk/complaint-iva/
• It would help if you told us a little more detail, before anyone can advise categorically.
  If you are a homeowner, and unable to release equity in month 54, it is quite normal for the iva to go on for 6years.
  The only other time an iva goes beyond the usual 5 years is if you agreed a longer term from the outset, of it was imposed upon you by one of your creditors (HMRC & NRAM for example), or if you have in some way under paid: payment breaks, miscalculation of income etc.
  Are you correctly reviewing your expenditure? Doing so may help reduce your payment.
  Of course it is equally possible that you are dealing with an underpaid, under qualified case worker who couldn't care less. Iva companies are littered with these I'm afraid, and sometimes writing directly to your IP may help.
  Is your income made up solely of state benefits? If so and if you are not a homeowner, why did you enter an iva, rather than go bankrupt? My first thought is that going BR may be a quicker and cheaper solution. Whilst it would be a Shane to terminate the iva this far in, if you can stand the thought of another 6 years of a trashed credit rating, it may still be.
  Just a few things to consider, and good luck.
• Firstly thank you for the replies above.
  I am not a home owner, its in my partner's name.
  Secondly he is not named on any of my debts.
  Thirdly, when I went through April and May's income from the DWP its adds up to the same as Ј888.20p.
  My overall total debt is just slightly over Ј10,000.
  I am begining to wonder if I may qualify for a Debt Relief Order, but to be honest I think I maybe over the Ј50 threshold of left over income spare each month.
  I didnt want to go for bankruptcy because I couldnt afford the fees upfront.
  Debt Free Direct dont do bankruptcies.
  I have already told DFD that my main creditor Halifax who irresponsibly lent me credit, I will not be held to ransom and I will refuse point blank any increase in the terms because I simply feel its grossly unfair to force me to pay for longer.
  I have offered to increase payments to Ј150 and thats all I can afford.
• Are you calculating your income as Ј222 per week x 4 = Ј888 which is the 4 weekly figure?
  If so this is not the correct monthly figure, it is Ј222 x 52 divided by 12 = Ј962 per month
• Might be worth a visit to your local CAB.
  If your income is made up solely of means tested benefits, then it is unlikely that you will have more than Ј50 each month on paper (even if you do in reality).
  As you suggest a DRO may be worth looking into. However, if you fail the iva, be careful. It may be that with DFD's fee, your debt may be over Ј15k.
  You don't need DFD to go BR / DRO either. This can be done yourself, with CAB's assistance, and the required fee saved up by stopping iva repayments IF this is the route you decide.
  Based on the information provided, it would appear that an iva was not the best option for you. Iva's are usually better suited for people with larger debts (typically over Ј20k), a reasonable level of disposable income (cЈ200pcm or more), and who have assets like property to protect. You do not appear to meet any of these criteria.
  Some debt advice from someone other than a private firm, (whose primary objective is to make money after all), is probably therefore in order.
  There is a great website called 'debt camel' which gives a good jargon-free comparison of your debt options.
• Good advice from UPMNII. From what you have said, a DRO or bankruptcy would have been better options for you, but of course we don't don't know the full circumstances.
  If your income is made up solely of benefits, you will automatically pass the "less than Ј50 spare income" test for a DRO and if you go bankrupt you will not have to pay an IPA.
  Opting for an IVA because you can't afford bankruptcy fees just shows what a mess the UK insolvency system is in. There are charities that can help with bankruptcy fees if it would have taken you too long to save them up.
  If your IVA does fail, IMO you should put in a "mis-selling" complaint to your IP's authorising body and also to the Financial Ombudsman as per that link I gave before about complaining. (I said above you can't complain to the FO about an IVA, but you can complain about the actions of your IP and IVA firm before the IVA was set up.) You may not gain anything financially from these but you will have the satisfaction of helping to stop DFD from doing this sort of thing to other vulnerable people.
• BLOOLAGOON is right at some point in a year you will get extra payment for eg. my OH dla is payed every 4 wks on a Tuesday so on occasional month there will be 2 paydays one say might fall on 2nd of month and so another will be on 30th of same month . family allowance falls the same 4 wkly .
  222 a week is 11544 a year which is thus 962 a month that's an extra 74 a month you are in fact getting.
• I agree with everyone else, this does seem to be an occasion where there is confusion over the difference between weekly/fortnightly/4 weekly benefit payments and the monthly amount.
  If you want a precise answer then post the date you received each payment in the last couple of months and the amount.
  If you get paid monthly, e.g. ALWAYS on 26th of each month, then yes they have calculated it wrong.
  However if you get paid either weekly, fortnightly or 4 weekly then you need to look at the WHOLE year. The easiest way to do this is:
  weekly = amount x 52 weeks in the year divided by 12 months in the year
  fortnightly= amount x 26 fortnights in the year divided by 12 month in the year
  4 weekly = amount x 13 four-weekly periods in the year divided by 12 months in the year
  I suspect if you did the above you will see the amount they have put is correct.
  If it really is unaffordable then you need to check the rest of the your income and expenditure. If you do your costs weekly too, e.g. Ј50 per week for food, then you need to change this to a monthly figure in the same way the income is done. So Ј50 per week for food is 50 x 52 / 12 = Ј217 (rounded off), NOT Ј200.
• Thanks to everyone for the replies.
  I might go into the Citizens Advice Bureau this week and seek some advice about a Debt Relief Order.
  According to DFD, my total overall debt is indeed just slightly over Ј10K, and yes its includes their fees as I asked the question.
  I simply and quite clearly do not receive Ј962!! If I did I'd be laughing!!
  By the time I have paid out for everything I am left with, some weeks I dont get a penny to myself.
  I have been accepted for a complaint by the Financial Ombudsman Service, I will also add and ask them to investigate that the IVA was missold to me in the first place.
  Its not only that but DFD keep increasing the terms and conditions of the IVA a usual IVA is 5 years and mine is around 6. They are threatening to increase it to more then this and I have refused.