Would an IVA work for us?

poppy217

Hi, can anyone sahre their thoughts with me on the IVA's as I have read Martins guide to IVA's but not sure if this is the right thing for my husband and I.
From what I have read, I would say we are in debt crisis. We have a combined unsecured debt of approx £31,000 (£27,000 him & £4,000 me). These are credit cards, loans, catalogues. We are currently meeting all the minimum payments on each of these but this leaves us with absolutely nothing to live on and with two children aged 3 & 1 this is obviously a problem and causes ALOT of stress and tension.
We are not able to consolidate the debt into a secured loan as we have a house we bought for £130,000 with a mortgage of £123,000. The house needed alot of work doing to it so we took out a second mortgage to do the work and owe the £27,000. The house has been worth £170,000 but now alot less so there is no scope to borrow against it.
My husband works in investment banking and cant be made bankrupt as this would mean he would lose his job, does this same rule apply with IVA's or can you still work in the financial sector with an IVA? Would his work know that this has happened to him?
Also, as we are married and it is a combined debt although none of it is in joint names, can we both go through this process together and put all our debt together in an IVA or would we both have to go through the process separately?
Does an IVA sound like the right thing for our situation as I obviously wouldnt want to do anything to jeopodise my husbands job as then where would we be?
Please advise me on how I can proceed as we are both 32 years old and I am going to try *(hopefully with some help) and make a 6-8 year plan to get out of debt so we are debt free by 40!! It sounds great and I just hope its possible so please HELP!!!

RAS

poppy

You need to speak to one of the debt charities as they can best advise you; see here http://www.moneysavingexpert.com/loans/debt-help-plan#help

However, although you could do an IVA, I am surprised you are not considering a debt managment plan. That way, you do not have to sign the Insolvency register. IVAs are consider appropriate for about 3% of CCCS clients.

The other factor is that your personal debt level is insuffiicent to meet the requirements of an IVA (minimum £15K) and I suspect that any gain your OH achieved could be wiped out by the Insolvency fees.

Do come over the the DFW forum and put up an SOA and we may be able to help you sort thngs out a bit as well.

toshtec

First off you say you have a total of £31000 an answer suggested that as you only have a £4k debt ytourself you could not do an IVA implying I would say that you could not go joint.

Also regarding your partner being in a financial job you are correct in saying he could loose his job if he goes bankrupt the same applies to a solicitor, my wife worked for a company that was supposed to have been made bankrupt but the solicitors opted for an IVA that way they were able to continue in their profession of a solicitor, I doubt very much that your employers would know about it if you had an iva but they could not do a lot I believe in any event but I have posted a link at the end of my post which you can visit and get unbiased and expert advice on what to do.

I have just completed an IVA last August

My wife unknown to me had taken out around £35,000 of debt and I only discovered it when one day she told me she did not have enough money for food shopping, as I looked after the household bills she the shopping expenses she definately had the better bargain, we enjoyed holidays and various other things, we married off our daughter, I thought that all these things were being paid out of her wages/savings because as I said she had the better bargain with the bills and was being VERY well paid.

She though was borrowing money right left and centre and when she had exhausted the banks started on finance companies even just small ones to get a £1000 no questions asked etc loan.

I thought we had a loan of around£13k and 2 credit cards her's and mine.

The long and the short of it, we were near bankrupt but I did not want to loose the house I had worked so hard to get, its not high value even now its only worth just around £80,000 but it was mine.

I took the line that we should join together to beat this problem and in a way unwisely aligned myself with her debt as it seems what I could have done and should have done, was to buy out her share of the house equity and make her go bankrupt I would have not lost the house nor would I be in the boat I am now, not being able get a mortgage at a decent rate.

After faffing around with DMP's that never worked we found the IVA route.

I had a very sympathetic supervisor who answered all and any questions I threw at him over the time he was my supervisor sadly he was made redundant 2 years ago.

Ray was extremely helpfull to me.

I have been reading a few of the posts re obtaining an IVA and thought no that was not my experience.

Regarding a question of joint IVA my wife and I had one we were treated as a single entity in the sense it was a joint account.

I had a finance company who had a veto vote on the IVA, Ray managed to get them excluded from it and we continued paying them separately again with no hassle from them that was the arraingement that was made with them they left us alone and would complete their debt around the same time as the IVA which was successfully accepted by the other companies.

This in itself I have been told was unusual.

Re the equity of the house in the 4th year, Ray somehow managed to have it capped to 75% or a maximum of £4000 our house at the time had around £3000 equity in it it has risen to £60,000 equity but the maximum we had to pay was £4000 so its always worth asking your IVA supervisor if he can get a cap on the equity it was also agreed that I would have an extra 12 months to pay that £4k making my 5yr IVA in to a 6yr IVA which in the equity stakes is normal just mine was capped.

I had wage increases but the cost of living went up also so infact my monthly payment never realy changed, my standard of living went down as there was less and less money spare but we managed.

About 3 years in a full and final was suggested by another company and I enquired from Ray the feasability and what he thought the creditors would accept he told me less than half more like 45% of the iva total, I investigated this course but found that for a short term gain in my monthly allowance it would extend my payment schedule by at least a further 5 years so guys not a wise move if you can manage with what you have got.

In the last couple of months of year 5 I suggested to my new supervisor (for as I said Ray had been made redundant and his office closed) that perhaps the creditors would accept £2000 in a lump sum payment for the equity I had to pay, amazingly they accepted all this concluded last august.

Why write this well I wanted to give an example of just how an IVA can be tailored to your needs and how a realy experienced Supervisor can make life so much easier for you.

Ray was helpfull in all aspects of creating the income expenditure form suggesting things I would never have thought of but were valid expenses that I did actually have, even smokes and a night out with the boys which I told him I did not do so that in my naevity was not included even though it was obvious he was suggesting expenses i could actually claim.

However when it came to my Dog's insurance he told me I could not include it as an item as the creditors would tell me to get rid of the dog that they would not pay for its upkeep so I had to include it in my monthly shopping bill that caused a quite few queries but were eventually accepted.

it seems that hair cuts, hair does, perfume, toiletries of a similar like can all be included, get your Supervisor to give you a list all-beit an unofficial list of things that you can put down as expenses you would be surprised at just how many you do actually have but never thought of.

Dont do anything illegal or lie on the I&E form just ensure you claim all there is for you to claim for, there is so much and your supervisor knows them all.

To anyone looking for a good IVA company ask people who have done one for their experiences mine was wonderfull untill the last 18months when I was sold out to another company or i would heartily recommend the one I had and the office to contact I just wish Ray well.

This web site below has a grading system for them and you can read reviews of the companies and peoples experiences, pay them a visit.

http://www.iva.com

Remember there are good and bad out there I have experienced both of them, but have now have put that episode of my life behind me.

All the best, I wish you all well in sorting out your financial problems and remember if you do not have to go down this route but just look to see if you can bankrupt your partner if they have the debt, especially if there is no equity in your home as is probably now the case in many homes speak to an IP about buying out the token equity from the family home from the bankruptable partner and then have that partner go down the BK route.

I would suggest you also visit this site http://www.debtquestions.co.uk/forum/index.php and speak to Simon Wiggins he is their expert.

There is also a question and answer forum just like this one where you can get advise from people like me who have been through what you are going through.

http://www.debtquestions.co.uk/debt_forum/

Simon will be able to advise you better than me he was extremely helpfull with his advice about our IVA and it worked.

This is the first time for me to post on this board so dont know if messages can be passed but if you want to you can mail me and I will try and advise you on what I have done.

There is now also a I think its called a simple IVA which gets you over and done with in a matter of a short time.


Alun

poppy217

Thanks so much for your kind and extremely helpful replies. I am just going through things and completing a statement of affairs as we speak so keep an eye out shortly!!

Thanks again.