IVA, think we've been done!!!

beautiful-dreamer

Hi

In 2001 my husband and i entered into an IVA with Debtfree Direct. We made our payments for 4 years and then were told we could complete early. We had to make an offer to our creditors and because property prices had increased, we had equity. We were told at the beginning of the IVA that once we had made the payments over the agreed term we would be 'debt free'.

We made an offer to the creditors and the company said that they would suggest that we offer as much as possible to ensure that it would be accepted. We ended up offering as much as what we owed in the first place, even though we had made monthly payments for the four years (which didn't seem to count for anything).

Anyway we completed the IVA, re-mortgaged the house to cover the payment to creditors. The IVA ended in 2005 and we still have a problem getting credit. Is this normal for it to take so long to build up a credit score?

I also feel that Debt free direct who were so helpful in the beginning, were actually working for the creditors in the end. We have still ended up with extra debt because it has now moved onto our mortgage. I really feel that IVA's are miss-sold. Sorry to moan, but 3 years after it completed it still doesn't feel like it's gone away.

moneysavingplumber

Have you checked your Experian credit file to see what it says? Any defaults included in your IVA should have dropped off in 2007, as should your IVA if it began in 2001. Simple things like not being on the electoral roll will have an effect on your credit rating, as will alot of other seemingly small factors. You can sign up for a month trial at www.creditexpert.co.uk to check your file, although it will cost £5.95 to check your credit score with them. The best way to rebuild your credit rating is to start with sub-prime cards like Vanquis, and use and pay them off regularly to build up a pattern of good behaviour, before moving onto mainstream credit. Excessive applications in short spaces of time will hurt your rating.

When I entered into my IVA it was made clear to me by my supervisor that the role of supervisor switches during the agreement to be far more in favour of the creditor than it is in the beginning, it doesn't sound as though it was made as clear to you.

beautiful-dreamer

Hi

No, nothing like that was explained. In the beginning they were using Lathams accountants, then they moved buildings, accountants and paperwork couldn't be found that we had sent. Basically it was a nightmare from start to finish and doesn't seem to be coming to an end.

I have checked my credit report and had to make a request for some things to be removed. They have now been taken off, but i must admit my husband hasn't done that yet so we'll get that sorted.

Not sure if Debt Free Direct have improved any, but they would tell us things verbally on the phone and then deny all knowledge of saying anything. I would ask them to check the 'recorded for training' tapes, this was because i had dates and times for all calls logged, but they would say that it wasn't recorded!!

I really wish i'd know about this site in the very beginning, there are so many other options available, but we were desperate!!!

fermi

Only time for a quick post.

Have a read of this thread if you haven't already: Credit Reference File Clean Up Post IVA

As MSP implies, even when anything adverse has disappeared it won't necessarily mean that credit will be easy.

beautiful-dreamer

Thank you fermi, interesting link

skintandscared_2

I don't think there used to be as much publicity or information about IVAs, because I've looked into them over the past couple of months (finallly decided on a DMP) and I saw straight away that if you have property you will be expected to refinance in year 4 to pay your creditors as much of the debt as possible. I just don't think people used to be told all the facts when they signed up, which is really bad. A lot of people choose an IVA over a DMP because they believe that anything after 5 years is written off, and that happens in some cases (especially where the person doesn't have a property). But often a DMP is a better option because you are actually paying off your debt month by month (IF the creditors freeze interest, that is) and although it may take longer, you don't end up with extra finance on your mortgage. I suppose the only positive thing is that if your property is still worth more than the mortgage plus refinance, you can downsize property and clear that extra monthly payment? But maybe in this current climate that's not an available option? I really do feel for you - there are definitely some IVA practitioners who don't seem to care about their client's position and don't give full advice on what's best for them...

beautiful-dreamer

very true. They were quite a new concept and looked like the answer to all money problems. There was no FSA either so it was wide open for practitioners to do as they liked!!

We were told that after 5 years we would be 'debt free', likely story! we do have money in the property and fortunately are managing, but can't really downsize the house isn't a big place to start with.

Don't want to sound silly but what is 'DMP'?

moneysavingplumber

As far as I can gather from your post you are indeed now debt free (with the exception of your mortgage), the issue seems to be your credit rating. If you completed your IVA then all known debts included in it will be written off, that's the law. Did you receive a Certificate of Due Completion?

Have you had any demands against debts included in the IVA since it finished? If you have it may be because they have not been removed from your credit file and a low-life company has bought the debt for peanuts and is trying to collect on it, which they cannot do.

A DMP is a Debt Management Plan.

marina.justin

Hi, I too have an IVA with Debt Free Direct and I also feel the same way. I feel I was misinformed by them. At the time, I was suffering from depression and should have seeked some advice before taking out this IVA, I was under no condition to understand what an IVA was really about, but DFD made it sound so easy to get out of debt. The agreement was complicated to understand, I was told by DFD to just signed it and return it. After 4years into the IVA, I'm now finding out more about my IVA and I'm not pleased. I agreed to the IVA under duress. My creditors had put enormous pressure on me, so I saw no other choice but to take out an IVA with DFD. I'm now in control of my life and now I want proof of some of my debts, as I can't remember when I accumulated them. Already I've made DFD to remove a debt which I've already paid off. My debt was between £14-16'000, so I felt DFD should not have offered me the IVA, but instead give me some form of advice.

beautiful-dreamer

Technically i'm debt free, but have had to add it to my mortgage. The thing with DFD is that they tell you that after 4 years that's it, no debt. Which yes it's true, but what they don't tell you is that you have to re-mortgage to clear it.

I really feel for you marina.justin because i too was depressed with the debt situation. DFD really make you feel like all your troubles will be over. At the end of the day they are a business who make money out of people who are in what can sometimes be traumatic situations. The customer service at the beginning is fantastic, but towards the end, when their intentions turn to the creditors side they really don't help at all. I found them at times very rude, they lie about things they have said on the phone and one guy in particular actually avoided talking to me on the phone.

I wouldn't recommend DFD to my worst enemy!!

skintandscared_2

See it's stories like yours that make me angry when people say "only do an IVA if you have property to protect". Yes, if your only other possible option is bankruptcy then you have more chance of keeping your house by doing an IVA. BUT if you don't have a property, there's nothing to refinance and the creditors know from day one that the offer on the table is all they will be getting. If they agree to it, it's a much cheaper option than a DMP for a non-property owner. That element of it seems really unfair on property owners!! But, from what I've read on here, the chances of non-property owners getting accepted for IVAs are getting less and less.