Custardcream,
Wasn't the original figure based on your figures for income/expenditure?
If so, creditors wanting more is understandable but nonetheless irrelevant. Surely if you agree on this basis, you are likely to find it runs aground sooner rather than later when you can't meet the payments.?
Are you expected to have a family member contribute to achieve a higher figure to pay creditors?

Hi custardcream

Slightly strange as I have never known creditors in a Trust Deed to come back with a request like this. Normally the 2 deciding firms (TIX and GT) will say excessive fees or insufficient dividend. I've never ( in 20+ years) had a suggested increase. Could you find out who objected and I'll do a wee bit of digging.

Mark

Hi Custardcream

6 months ago I was in a similar position to you are now, so I hope my advice / experience will be helpful to you.

The creditors are likely to have rejected your proposal on the basis of they think elements of your expenditure are is high rather than your Trustee's expenses being too high. Basicially, your creditors or their representatives will have set guidlines of what they will find acceptable in relation to expenses, which may not necessarily be as high as your actual cost. An example of this would be TV subscription costs may be £50/month, but their guidline may me basic package at £18/month, hence if you reduce your package you can afford to pay an additional £32/month into your PTD to pay the creditors that you (like the rest of us in the same position) borrowed the money from (this particular example specifically may not apply to you, but you will get the idea).

I think it is unlikely that the Trustee would reduce their fees. As I'm sure Mark, Kevin or Shona would testify to, it is unlikey they make a killing on us. They are business' so they will look to make a profit (or else why bother?). Their fees are are calculted on the basis of a lot of initial work put into the PTD, a lot of hours spent by staff, the management of the PTD for the 3 year period (taking our calls, contacting creditors who just keep torturing us, completing your 6 month reviews and finally dicharging us, plus all their overhead costs incurred such as office rent, electricity, heating, stationary etc).

Sequestration is similar to a PTD in many respects. If you have little or no equity in your house or car it is unlikey you will lose them. Also, although you will be discharged from sequestration in 12 months, you will still need to make contributions, with the value of those contributions calculated in the same manner as those on a PTD (i.e. any excess expenditure - I would imagine sequestration would be a lot more onorous).

In my case our proposal to the creditors was that my wife and I would each pay in £300/month. This was rejected and a counter offer from the creditors of £400 was agreed. It The last 7 months have been a struggle, but we have been able to make the payments, just. I suppose that is the point, we lived outwith our means for a long time and now we have had to cut way down on our spending. Things we thought essential we have managed without. I won't lie, it has been difficult (very difficult), but in 28 months time (I no, too soon to be counting down) we will see this is the best thing ever to happen to us.

Talk to your Trustee, give the PTD a go, if it doesn't work out there is always sequestration. You will be surprised on what you can do without. The last 8 months have flown by and hopefully the next 28 will fly by too. 36 months really isn't that long.

Sorry, meant to mention, contributions to sequestration last for AT LEAST 36 months! Or else we'd all have done it 🙂

your house is worth 150k but how much equity is in it?

Paul

Hi all

It just doesn't quite sound right. Creditors will object normally on 2 grounds. Fees and dividend.

I have halved average fees to get trust deeds through, if this job is based on maximum profit, then we are not in the right job. We know beforehand if trust feeds will be accepted as we are given criteria. Don't let firms fool you that this is not the case.

Please keep us posted. I'd love to know the specifics of this.

Mark

Thanks for the replies everyone. I was on jury service on Friday so didn't have any time to talk further, so will find out more tomorrow. Still on jury service but now have a bit more info to back up the feeling that it didnt sound right, and now I have a lot of questions to ask. I am annoyed to be honest, as I thought the uncertainty was behind me in regards to this. It is more the possibility that creditors could start legal action before the TD is protected, leaving me open to further hassles. Of course, I was under no illusion that things would run smoothly, I just didn't expect this.

I am keen to find out who these mystery creditors are who want the extra payment, I am sure AIB was menioned who decided the payments was not enough from feedback from creditors. Am I able to contact them myself to find out the details, or get them to confirm anything? I have no idea as yet whether it failed under the number of creditors or value. My worry was that Halifax/BoS made up a significant percentage of the debt from overdraft, loan, 2 credit cards, so I suspect it could be them. I have no reason to distrust my trustee, and have been very happy so far but I wasn't expecting this situation to arise. I don't really want to pay the extra if I don't have to obviously, but I can't help wondering if the creditors will actually see the extra money, as we are talking almost an extra £3k with the increased payments. The original return proposed to creditors was 18p in the £. If I changed to a different trustee (if I even have that option now) would the 5 weeks start again, or would it be a matter of getting some reference number or whatever for the new trustee to take this on instead? I would not like to think the choice of trustee would be the limiting factor in the success of the trust deed, or whether they are doing all that the can to make the trust deed work, including being firm with creditors?

plasticdaft, I have just under 4k (actually £9k but -5k for costs for sale) equity in the property at the moment taking the lower valuation.

Hi custard cream

I think you need to ask the question.

The creditors you mention are TIX creditors and work to a formula. I've never known them to say they want x amount of contribution, especially at the amounts mentioned.

Please let us know how you get on

Mark

Hi custardcream.

I think we've heard from a few people on the forum over time where creditors felt that they were in a position to pay a little more than was offered originally in the trust deed. They are within their rights to do this.

It's really for you and your trust deed firm to work together at this point to see whether you can (and will) increase the monthly payment in line with the amount your creditors are expecting.

I'm sure that your Trustee, just like you, will be keen to get this quickly resolved.

Hopefully your trustee will be able to shed some light on the issue for you custardcream. TIX don't just look at fees and dividend, they also look at the stated income/expenditure.

I have a suspicion that poorboy is probably right, ie there may be an item of expenditure that a creditor has objected to as being too high. Therefore they may have gone back to your trustee to see that you are spending x amount too much in this area and your contributions need to be increased by that amount. It is definitely worth finding out if this is the case as there may be perfectly good reasons why your expenditure in this area might be higher than average and if your trustee were to make this clear to the creditor concerned they may accept the proposals after all.

Heard back that 2 categories were deemed to be a bit high for a single person, and that the Insolvency Exchange had made this decision on behalf of the creditors.

So it seems either take it or leave it regarding the extra monthly amount, or go down the sequestration route, where I am assured again I will keep car and house, but will need to 'deal with value' at the end of the 3 years. Still leaning towards the trust deed even with the increased amount, for me the sequestration doesnt seem like the best option for me, it just doesnt sit right with me for some reason, I feel there are too many unknowns and after struggling with paying back debts for years and finding a workable solution in the TD, that is what I ought to stick to.

For me, the stamp of approval of a PTD is quite a big step I feel I can't really relax until it is protected then I can move on and deal with it, but until then worried out legal action or some other obstacle appearing.

Hi custardcream

It would be interesting to find out which 2 categories they thought were too high. It just doesnt quite feel right.

Any decent IP will know what the minimum/maximums are beforehand and too be out by 25% is a wee bit odd.

Try and find out which parts of the expenditure it was. If something is above the normal, we usually provide a wee side not to explain it and generally that will be sufficient.

Mark

It was general food and lunches. The problem might have arisen as I had originall put £260 for food including lunches and including dog food/treats too, but my IP re-adjusted all my amounts, added in some categories such as charity, magazines etc that I didn't have as I don't spend anyhting on these, and lowered amounts on some other categories. The end result was the same figure I had already worked out as my available income. I don't have the paperwork to hand with the amounts they substituted but I know they kept food at 260 and put lunches seperately.

The administrator of the TD isnt available today, so was only getting some info back from someone else in the office but should find out more tomorrow, as the 17th is actually the official end of the 5 weeks anyway, so I am just keen to get a set decision. How do I know the creditors are going to actually get the increased amount? Can I ask to see a copy of the letter from the 'Insolvency Exchange'?

The new payment would be £355 instead of the proposed £280 so it's not a huge amount, but 25-ish% is around £2700 over the 3 years. Bearing in mind home equity is £4k, this extra could be set aside in a savings account (if not needed for emergencies) as a good chunk towards the equity.

Is it possible to change IP at this late stage, and would there be another 5 weeks wait?

You can change IP if you havent signed anything. I would be wary of figures which have been adjusted to fit a proposal.

Is the £355 affordable to you?

Paul