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At my wits end
Hi everyone, i really need some advice
I had my IVA proposal rejected today and i dont know what to do.
A little background.
My husband and i separated in Feb this year. We have owned the house since 2010.and took out a loan for home improvements as the house was in a bit of a state. We had a new boiler, windows, bathroom and the roof needed sorting. Its still in a state of disrepair and needs a lot of work. The credit is all in my name and the most recent was in Jan this year for just over £10k. My marriage breakdown wasnt forseen and the debts, including overdrafts, catalogues etc amount to around £60k. There is around £9k equity in the house so a little under £5k each. I am unsure why the IVA was rejected but my IP seems to think it could be because the loan was only taken in october last year through a credit union, but is trying to find out. The most recent large debt is £10k and was taken in Jan for new windows and doors....the old ones were secured by tape and wood!
I have 3 children the youngest being 13. I am afraid we are going to lose our home because if my IVA was rejected, they arent going to accept a DMP as the payments would only be £200pm which is what my IVA proposal was, so the only alternative is bankruptcy. I havent slept for 3 nights and i am devastated at the mess i am in. If we lose our home that will be it. I dont know what to do now, and i really need some advice.
I had my IVA proposal rejected today and i dont know what to do.
A little background.
My husband and i separated in Feb this year. We have owned the house since 2010.and took out a loan for home improvements as the house was in a bit of a state. We had a new boiler, windows, bathroom and the roof needed sorting. Its still in a state of disrepair and needs a lot of work. The credit is all in my name and the most recent was in Jan this year for just over £10k. My marriage breakdown wasnt forseen and the debts, including overdrafts, catalogues etc amount to around £60k. There is around £9k equity in the house so a little under £5k each. I am unsure why the IVA was rejected but my IP seems to think it could be because the loan was only taken in october last year through a credit union, but is trying to find out. The most recent large debt is £10k and was taken in Jan for new windows and doors....the old ones were secured by tape and wood!
I have 3 children the youngest being 13. I am afraid we are going to lose our home because if my IVA was rejected, they arent going to accept a DMP as the payments would only be £200pm which is what my IVA proposal was, so the only alternative is bankruptcy. I havent slept for 3 nights and i am devastated at the mess i am in. If we lose our home that will be it. I dont know what to do now, and i really need some advice.
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Comments
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who proposed your IVA for you? They should be offering you alternative advice...
Alternatively call Step Change Debt Charity, or National Debtline, or visit your local CAB and get an appointment with a debt advisor, tell them what's happened with your IVA and they will advise you on the best way forward.
The numbers for Step Change and NDL are
Step Change - 0800 138 1111 (open monday - friday 8-8 and saturday 9-4) - their website says this number is free for mobiles too.
NDL - 0808 808 4000 (monday - friday 9-9 and saturday 9.30 - 1)
if you would prefer face to face advice at CAB you can find your local CAB here http://www.citizensadvice.org.uk/0 -
I would also get some matrimonial law advice as well. If you have the debts in your name and you have children then your husband does have a financial obligation.
I just did the maths, £200 over five years (a normal IVA period) would be £12000 back to your creditors so it is a low dividend. However it is still by the looks of it more than your creditors would get from a bankruptcy, so yes I agree you need another debt agency to look at this but it is combined with your husbands obligations to the family as well so more complex than usual.
It is incredibly stressful so do try and get good advice as soon as possible that will go some way towards making you feel a little better.now debt free and determined to maintain good spending habits and build savings0 -
Credit unions can be difficult in IVAs i am afraid, did your IVA company try to negotiate with them? I agree it may be due to the recent loan, especially if they account for over 25% of the overall debts?
Could you consider doing a temporary DMP and proposing another IVA in 6months time0 -
Sorry to hear about your situation, cheesedoffwithdebt has a great suggestion there about matrimonial law or even property law. The debts might be in your name, but there for joint benefit of the property and I would argue he does have some liability for them. I'm a little surprised you suggest the 9k equity would be split you've been left with the debt but suppose it would legally be his. Anondebtadvisor also has a good suggestion about the temporary DMP, I think when we done ours something was mentioned about larger balances under 6 months old not being allowed, but might be imaging that.
One thing that would concern me about your situation given, if the house is still in a state of disrepair then your not going to have much money or credit to fix things up or go wrong in the next 5/6yrs.
How important is the house to you? You could consider selling or surrendering the house and renting for the duration or more of the iva, then it's a clear 5yrs and no worries about equity release clauses etc. A bit extreme I know and whilst this approach isn't for everyone, it's what we did and I think in the position your in would be worth some consideration. Renting may work out cheaper than owning and then your dividend would increase making your proposal more viable.
With the credit union loan, is there any savings secured on it? Think my credit union offer 'save to borrow' and 'borrow to save' loans to max. 7.5k Is there anything for them to draw on to reduce the 10k balance?Roll on DFD, final payment 1st October 2017 :beer:0 -
Hi,
If you only have £5 equity then it is very unlikely you would lose your home in BR.
£5k is no where near enough to attract an IP so current IS guidlines are that if no one comes forward to purchase the beneficial interest where equity is less than £10k then a charging order would be sought rather than sale.
All of this is dependant upon if you can afford the secured lending costs - if you can then losing the house is unlikely unless property prices shoot up.
DDDebt Doctor, Debt caseworker, Citizens' Advice Bureau .
Impartial debt advice services: Citizens Advice Bureau Find your local CAB *** National Debtline - Tel: 0808 808 4000*** BSC No. 100 ***0 -
I disagree that £12k on a £60k debt is a low dividend, I have known Ivas accepted at 2p in the £, I think it is more the fact you have a credit union loan, credit union are not iva friendly I don't think, I also don't think it has anything to do with the fact you only got a loan last October, we had a loan agreed only a few months before our iva was proposed and accepted by the creditor in question.
I would put your faith in your ip to continue to negotiate to get the iva approved, there is still time so don't rule it out completely as yet.
Although the concerning thing is how will you manage with a house in a significant state of disrepair for the next 5/6 years in an iva?Aug GC £63.23/£200, Total Savings £00
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