Iva?????

Busymumof5

Hi everyone, I am getting help with debts with Payplan (thank you to everyone here for advice) but my brother is having money problems too and was wondering about IVA. He doesn't have internet so I said I would get some info for him.

How does it work?
What has doesn't have to be included?
Who is it suitable for?

Don't really know much about it but he has debts of around £40,000 so quite a lot for debt management I think.
Thank you in advance for any information.

Nomad25

Welcome Busymum

I'm not a DFW guru, but one will spot you soon. In the meantime, I'm pretty sure your brother will be advised against by those more experienced than me.

CCCS_Alan

Hi Busymumof5

An IVA unfortunately is not suitable for everyone. It is a legally binding contract for repayment of a % of the money owed, normally over a period of 60 months (5 years) of monthly repayments run through an insolvency practitioner. Failure to meet the agreement can lead to the persons/couple been made bankrupt. Assets are also taken into account normally in year 4 of the IVA for equity release giving the creditors a better return. But if the client has enough equity to clear all debt an IVA would not be suitable. They are just a few brief factors but much more is involved and taken into consideration.

If he does not have the internet I would recommend him to contact our helpline free on 0800 138 1111. Lines are open Monday to Friday 08:00-20:00. We will arrange a time that is convenient for him to have an appointment with a trained debt counsellor. For the appointment we will call him back at the agreed date and time. They will look at his situation and discuss options that may be available for him to help resolve his situation.

Hope this helps

CCCS_Alan

mrskingandthescarecrow

Hi, my IVA has recently failed so I thought I would share some of my experience with you.

I paid into my IVA with my ex (jointly took out the IVA) for 13 months and it failed following our separation. I have now found myself in the same position as I was 13 months ago as the 5k we paid in barely covered the IVA fees so nothing has all been paid to our creditors and I am now expecting the debt collector letters to start popping through the letter box again.

Also I wanted to point out that they are not the quick fix the adverts promise of paying x amount for 5 years then they wipe the rest off. They will review your incoming and expenditure every year and increase your payments. If you have a house they will look to you remortgaging for no less then 85% to pay more money into the IVA. If you are unale to remortgage, some IVAs have a clause where they can extend the IVA terms to 72 payments not 60. So the reality of it is you could end up paying 100% of your debts back + interest + IVA fees. In hindsight, not what it says on the tin.

My IVA was with Debt Matters who then sold the IVA to Grant Thornton who wanted to change the terms of the IVA so that out of every pound we paid in they would take 25p for their (very little) efforts.

I have read a few articles lately where most of the original amount owed had been paid back by the time the IVA had finished.

I took out my IVA because I didn't want to lose my house but now me and my ex have split I can't afford the mortgage and it looks like I will lose the house anyway. If I'd gone bankrupt last year instead of taking out the IVA I would have been discharged by now - sickener.

I would mention the positives of an IVA but I can't think of any right now

mrskingandthescarecrow

Just to add, the IVA company won't petition our bankruptcy now the IVA failed because there isn't enough money in the pot now they have taken their fees out so if we want to go bankrupt we've got to find the money to petiition it ourselves. In the meantime, we will have the creditors writing to us again harrassing us to pay up.

What a waste of 5 grand!