Can Housing Benefit Overpayment be Included in an IVA?
If you’re facing financial difficulties and considering an Individual Voluntary Arrangement (IVA) to manage your debts, you may be wondering if housing benefit overpayments can be included in the arrangement. This article will address this question directly and provide answers to related FAQs about housing benefit overpayments and IVAs.
Can housing benefit overpayment be included in an IVA?
Yes, housing benefit overpayments can be included in an IVA. An IVA is a formal agreement between you and your creditors to repay your debts over a fixed period of time, typically five years. This means that housing benefit overpayments, like other unsecured debts, can be included in the arrangement.
What is a housing benefit overpayment?
A housing benefit overpayment occurs when you’ve received more housing benefit than you were entitled to. This can happen due to changes in your circumstances, incorrect information provided, or delays in reporting changes.
Why would housing benefit overpayments be included in an IVA?
Housing benefit overpayments, like other unsecured debts, are included in an IVA to ensure that all your creditors are treated equally. Including housing benefit overpayments allows you to address this debt while repaying other debts through an affordable monthly payment.
Do I need to provide proof of the housing benefit overpayment?
Yes, when entering an IVA, you will need to provide proof of the housing benefit overpayment to your Insolvency Practitioner (IP). This may include letters from your local council or any other relevant documentation.
Can I still receive housing benefit while in an IVA?
Being in an IVA does not necessarily prevent you from receiving housing benefit if you continue to meet the eligibility criteria. However, it’s crucial to inform your local council about your IVA.
Will including housing benefit overpayment affect my entitlement to future benefits?
While including a housing benefit overpayment in an IVA may not directly impact your entitlement to future benefits, it’s essential to inform the relevant authorities about your situation. They will assess your eligibility based on their own criteria.
Can the local council recover the housing benefit overpayment during an IVA?
When you enter into an IVA, your Insolvency Practitioner will deal with your creditors, including the local council or their appointed debt recovery agency. The overpayment will be treated on par with other unsecured debts within the IVA process.
What happens to the housing benefit overpayment if my IVA is successfully completed?
If you successfully complete your IVA, any remaining balance on your housing benefit overpayment will be written off, and you will no longer owe the debt. It is important to follow the terms of your IVA to ensure successful completion.
Can the local council refuse to include the housing benefit overpayment in an IVA?
While it is possible for a local council to reject the inclusion of a housing benefit overpayment in an IVA, most councils are willing to cooperate given the overall benefit of an IVA in addressing your debts.
Can including the housing benefit overpayment impact my credit rating?
Yes, including a housing benefit overpayment in an IVA can have an impact on your credit rating. However, it’s important to note that if you’re considering an IVA, your credit rating may already be affected due to your financial situation.
Can housing benefit overpayment be included in an IVA if legal action has been taken?
Including a housing benefit overpayment in an IVA is still possible, even if legal action has been taken. An IVA provides an opportunity to address your debts and work towards a more manageable financial situation.
Will including a housing benefit overpayment in an IVA stop recovery action?
Once your IVA is in place, all legal recovery action, including that taken by the local council, will be halted. This provides you with breathing space to manage your debts through the agreed-upon monthly payments.
Remember, it’s essential to consult with an experienced Insolvency Practitioner who can guide you through the process of including housing benefit overpayments in an IVA and help you understand your specific circumstances.