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  • FIRST POST
    • Stubbington
    • By Stubbington 22nd Oct 17, 2:23 PM
    • 2Posts
    • 0Thanks
    Stubbington
    S.O.A: about to start IVA. advice please
    • #1
    • 22nd Oct 17, 2:23 PM
    S.O.A: about to start IVA. advice please 22nd Oct 17 at 2:23 PM
    Hello all,
    I've read this forum for a long time now but this is my first post as I'm in financial trouble.

    Some background:
    I work as an architect in london where I rent a room in a shared house with friends. Its a classic story of using debt to live in London whilst the debt mounted up and more of my income was used to service the debt. Until I went through a physiologically hard period at the beginning of this year where I left my old job because of stress, was prescribed anti-depressants and didn't return to work until June of this year. This was the straw that broke the donkey's back and hence I am here about to engage with an IVA.

    Some figures:
    Income: Salary £2310

    Total owed: circa £42,700

    OverDraft: Limit £3200
    Balance £3198
    Monthly Fee £85

    Loan 1 Balance £7951
    Minimum Payment £304

    Loan 2 Balance £3247
    Minimum Payment £120

    CC1 Limit £9250
    Balance £9198
    Minimum Payment £173

    CC2 Limit £7825
    Balance £7290
    Minimum Payment £164

    CC3 Limit £13000
    Balance £11833
    Minimum Payment £234

    Total outgoings to service debts £1080

    Life outgoings:
    Rent £1000
    Council Tax £26
    Bills £90
    Mobile £55
    Internet £15
    TV £10
    Dog £100?
    Smoking £30
    Food £250
    Work food £60
    Dry cleaning £30
    Clothing £30
    Haircut £30
    Medicine £35
    Contents insurance £13
    Spotify £10
    Commute to work £230
    Total = £2014

    I've spoken with Debt Advice Foundation who recommended the IVA as the best option. Over this year I have been selling everything I own to make up the additional money required to service the debts. I have no asset of value left to sell. Being on the tablets I was on meant I was able to ignore the impossibility of the situation. I'm now ready to deal with it.

    Some Questions....
    - Given the above figures I have £296 left to pay the debt. £296 x (5x12) = £17760 debt paid (or 41% minimum paid back. Is this normal for an IVA?
    - I'm sure they'll squeeze more out of me. What kind of figure would you expect?
    - Can anyone recommend a good organisation to pursue the IVA with?

    Thank you in advance for your thoughts and advice. Please ask any questions if you think relevant.

    Many thanks,

    Steve
Page 1
    • sourcrates
    • By sourcrates 23rd Oct 17, 2:37 PM
    • 12,461 Posts
    • 11,855 Thanks
    sourcrates
    • #2
    • 23rd Oct 17, 2:37 PM
    • #2
    • 23rd Oct 17, 2:37 PM
    Hi,

    All IP `s charge for setting up and administering an IVA.

    The fee`s are usually included within your agreed monthly payments, make sure you budget well, you will have to lose the fags for a start, they are regarded as a luxury not essential.

    Your figures look reasonable, however, its down to the way they calculate your disposable income that will decide your monthly payments.

    Some good advice here, and a list of approved IP`s :

    https://www.citizensadvice.org.uk/debt-and-money/debt-solutions/individual-voluntary-arrangements/setting-up-an-individual-voluntary-arrangement/preparing-to-meet-the-insolvency-practitioner/
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.

    For free debt advice, contact either : Stepchange, National Debtline, or, CAB.
    For Legal advice see : http://legalbeagles.info/
    • StopIt
    • By StopIt 23rd Oct 17, 2:44 PM
    • 1,391 Posts
    • 1,182 Thanks
    StopIt
    • #3
    • 23rd Oct 17, 2:44 PM
    • #3
    • 23rd Oct 17, 2:44 PM
    Get a second opinion from a debt charity like Stepchange or the National Debtline.


    An IVA runs for 6 years, and is designed to protect assets, like a house. As you rent, this will not apply. Yes, you'd likely get an IPA if you declared bankruptcy, but that will only run for 3 years.


    In your case, I see little upside in the IVA route, but again, contact a debt charity whose MO isn't selling you products rather than helping, and see what they say.
    • DorisTrousers
    • By DorisTrousers 24th Oct 17, 2:16 PM
    • 492 Posts
    • 286 Thanks
    DorisTrousers
    • #4
    • 24th Oct 17, 2:16 PM
    • #4
    • 24th Oct 17, 2:16 PM
    Debt Advice Foundation IS a charity, so I see no reason to doubt their motives.

    There is room in that budget to get an IVA payment quite a bit lower than that, but BR should of course be given due consideration as well. Conversely, should you present that budget to The Official Receiver, it is likely that he or she would not accept it and look for more than is being offered in the way of an IPA/IPO. If you do decide to go BR, I would speak to your local CAB to get help and tips in preparing a budget that would lead to lesser payments.
    • mrtangoman
    • By mrtangoman 25th Oct 17, 2:17 AM
    • 5 Posts
    • 0 Thanks
    mrtangoman
    • #5
    • 25th Oct 17, 2:17 AM
    • #5
    • 25th Oct 17, 2:17 AM
    DO NOT USE " PAYPLAN " !!!!
    i have just finished an IVA with them and should NEVER been put on one in the first place !!!
    they were difficult to deal with in the IVA and now impossible to contact !!!!
    all they wanted from me was their MASSIVE admin charges
    hope what ever you choose to do works out, BUT ask several DIFFERENT places for advice as the first one may well NOT be you best option
    • Stubbington
    • By Stubbington 25th Oct 17, 8:22 AM
    • 2 Posts
    • 0 Thanks
    Stubbington
    • #6
    • 25th Oct 17, 8:22 AM
    • #6
    • 25th Oct 17, 8:22 AM
    Hi,
    So you think these is scope to reduce the money going out under an IVA? How so? Is the official receiver when going down the BR route?
    I understand I have no assets to protect but it's my understanding the payments are harsher = lower quality of life going down the BR route?
    • DorisTrousers
    • By DorisTrousers 25th Oct 17, 9:51 AM
    • 492 Posts
    • 286 Thanks
    DorisTrousers
    • #7
    • 25th Oct 17, 9:51 AM
    • #7
    • 25th Oct 17, 9:51 AM
    Only the individual can make their own decision, and for anybody on this forum, myself included, to tell people what to do does not sit right with me. The OR is independent and impartial, and will look to recover what can be recovered, as is their job. I can't speak for the OR on any individual case, but the amount of cases where IPA/IPO is set somewhat punitively seems to be more common than it once was.

    To get back to your budget I reckon you could probably get that to £220, maybe £240 (ish) using IVA guidelines, which are still set by StepChange by the way. Mathematically, and notwithstanding the fact that any IPA/IPO cannot be conclusively proved here, then BR is still likely, overall, to be a little cheaper and take 2 less years so, as ever, it all comes down to the choice of the individual.
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