Petrified of starting IVA

Fizz_Bomb · 14 October 2016 at 1:24PM

Hi, I am fairly new here after lurking for years... I am really pleased to have found this IVA forum as some posts about them on the main forum have frightened me to death.
I about to embark on an IVA after a year of deliberating, burying my head in the sand and accruing more debt.
I have been sent a proposal by Vincent bond who have been lovely and I have to say incredibly helpful. But I am petrified of signing the document and going for it. I haven't missed a single payment on my cards to date and the thought of stopping, shipping my money out of my long serving bank account and bracing myself for phone calls is pretty scary; but the thing I'm most scared of is having no credit to rely on going forward with christmas coming. I am a single mother to two boys who I desperately want the best for.
An iva or bankruptcy are my only options; I am minus £400 each month which has been going on credit. I owe approx 35k including an unsecured NRAM loan and have no way of paying this back.
There is no real point to this post really, I am an emotional wreck at the moment and really don't know where to turn. An additional worry is what will happen if the IVA is rejected, which I guess it very well could be with plenty of recent spending and an offer of £110 a month.
Thank you for letting me ramble.

National_Debtline · 14 October 2016 at 6:31PM

Hi Fizz Bomb

I have only glanced very briefly at your previous posts so forgive me if I'm overlooking something here (I know my colleagues have made one or two observations) but here are a couple of thoughts:

Rejection of an IVA for the reasons you cite is really very unlikely. Vincent Bond will not waste time and energy drafting a proposal that is at risk of being knocked back. A lot of creditors often pass up the chance to vote at all, in which case they are assumed to approve. As such, they are unlikely to scrutinise your recent spending to the third degree.

Any return your creditors get from an IVA is likely to be a great deal better than if you went bankrupt, for sure. Another reason it's hard to imagine them turning the IVA down.

Finally for now, you mention your worries about meeting the cost of Christmas. Clearly you're going to find yourself cutting your cloth a bit finer this year, but for now why not simply cancel your debt repayments (as they are clearly unaffordable)? According to your SOA you have a little bit of disposable income - for the next month or two it might be wise to ring-fence that as your emergency fund/Xmas budget/whatever you want to call it.

You don't need to jump straight from making full repayments to an IVA - you can take time inbetween to reflect on your next steps.

Dennis
@natdebtline

Fizz_Bomb · 14 October 2016 at 6:55PM

Dennis, thank you so much for your reply, you have reassured me a lot. I guess just taking the plunge to cancel those direct debits is pretty scary.
I have not yet opened a new bank account, is it wise to do this before taking any further action so that I can be sure Barclays won't take my money once they get wind of any difficulties?

Thank you again

mwarby · 14 October 2016 at 10:14PM

My IVA was arranged through Vincent Bond, at the time they didn't do this themselves but referred you to a third party IP.

I spoke to my IP during the setup and she was very confident, they don't take them too far if there's much doubt it'll be accepted as it costs them money. Assuming Vincent Bond are confident (maybe ask them how confident they are ?) try to relax and dont worry about failure until it actually happens

Fizz_Bomb · 15 October 2016 at 9:52AM

Thank you very much mwarby. The guy at Vincent bond is confident it'll be fine. I think the problem is me and my hesitancy in signing. I am still using credit, guess it's a hard habit to break, but one I know absolutely needs to happen.

fatbelly · 15 October 2016 at 11:55AM

Fizz_Bomb wrote: »

An iva or bankruptcy are my only options; I am minus £400 each month which has been going on credit. I owe approx 35k including an unsecured NRAM loan and have no way of paying this back.
There is no real point to this post really, I am an emotional wreck at the moment and really don't know where to turn. An additional worry is what will happen if the IVA is rejected, which I guess it very well could be with plenty of recent spending and an offer of £110 a month.
Thank you for letting me ramble.

I have had a look at your previous thread and agree that your best 2 options are as above.

I thought at the time that bankruptcy would suit you better but the lease arrangement on the car is a bit odd and might not be accepted in bankruptcy; in fact you could end up with a 3-year IPA of £400-500 per month so if they can swing a 5-year IVA at £110 you have done well.

mwarby · 15 October 2016 at 2:03PM

Fizz_Bomb wrote: »

Thank you very much mwarby. The guy at Vincent bond is confident it'll be fine. I think the problem is me and my hesitancy in signing. I am still using credit, guess it's a hard habit to break, but one I know absolutely needs to happen.

Is it Andy Davie by any chance, if so he knows his stuff(I'm sure others do too), I think he wrote a book on his IVA experience

sourcrates · 15 October 2016 at 11:15PM

Fizz_Bomb wrote: »

Dennis, thank you so much for your reply, you have reassured me a lot. I guess just taking the plunge to cancel those direct debits is pretty scary.
I have not yet opened a new bank account, is it wise to do this before taking any further action so that I can be sure Barclays won't take my money once they get wind of any difficulties?

Thank you again

Yes, you need to be on the ball here.

A new basic bank account is a must have, ideally you want everything in place before you start the IVA.

It's somewhat unusual to go from making payments one month, to an IVA the next, most people have long since defaulted there accounts before they do anything about it.

I would cease all your credit payments for a while, get an emergency fund together, also make certain you budget correctly before hand, that's were most go wrong.

My IVA finished in 2014, best thing I ever did to tackle my debts, once approved, you have a yearly review, that's it, you don't know your on one half the time.

Good luck with it.

Fizz_Bomb · 16 October 2016 at 8:54AM

Not Andy Davie but Keith White. Good to know the firm have a good reputation though

Fizz_Bomb · 16 October 2016 at 8:57AM

Thank you. Do you suggest I wait a couple of months before signing IVA proposal and default on payments during this time? The bulk of my debt is with Barclays who I also bank with, so I guess I'm anxious of doing this before moving all my wages etc out of the account.
I think I will try to get that basic account open tomorrow and go from there.
Thank you very much for your replies

owlet · 16 October 2016 at 10:51AM

Don't panic, it will be straightforward. I think you are in a situation where you can't see the wood for the trees at the moment - too many thoughts whirling around.

1. Get a new basic account opened (nationwide flex basic is great)
2. Contact payroll at work and get your pay moved to the new account.
3. At the same time, cancel your direct debits to creditors & move essential living direct debits to your new account.
4. Build up a fund for christmas and emergencies using the money you would have paid to creditors.
5. Talk to your IVA advisor about the best time to proceed - tell him you need to build up a small emergency fund first - suggest that first thing January would be good perhaps.
6. Do nos 1, 2 & 3 asap then take time to breathe and collect your thoughts.

It's scary not having credit to rely on I know, but it's surprising how easy it is once the debts are out of the way. I had to go BR rather than IVA but those initial steps are the same. If you haven't yet defaulted that's good because it gives you more time to save that emergency / Christmas fund before you start getting hassle from them .

Come back and let us know how you are going x

Edit: remember that children don't need loads spending on presents to make it happy and memorable. Shop around and pick up a few bits in sales etc. My budget this year for my young nieces is £8 max each. I've now got their presents and two of them were just £4.95 each - and they are Disney activity books, which they will love.

Petrified of starting IVA

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