What exactly is an IVA

wendywoo1982

Hi, i was considering going BR but after advice from this forum i have been told i should just struggle for 4 years rather than going BR as it is really a last resort for debt. But wondered if an IVA might be an option to lower my debt and maybe get it paid off sooner?? But i dont know much about them and if they're maybe too good to be true and if i would qualify for one. I have just over £15,000 of debt, my outgoings are about £570/month my income is £940, i should be able to pay my debts off every month but im struggling at the min since xmas 2008 really nocked me off my feet money wise.

Any advice on this would be great.

Thanks very much

Tr@cker

Its probably better to struggle on with that level of debt if you possibly can. You need to have at least 3 creditors to qualify for an IVA.

Ive seen much bigger debts in IVA's it looks a better proposition at the higher end of the scale to me.

Most of the advice here seems to be against going for an IVA as there are many cases where they are miss-sold-the firms charge high fees- to people who would be better going for a DMP.

Nargleblast

Suggest you contact CCCS (Consumer Credit Counselling Service) as they can go through your options with you. You could go down the Debt Management plan route rather than IVA or Bankruptcy, but they will be able to look at your circumstances and tell you if it is feasible. They have a website you can go on for more info. They are also a debt counselling charity so their services are free, do not ever go to a firm that charges you. (If you did go down the IVA or BR route then there would be charges but you would be fully informed about that side of things).

wendywoo1982

Tr@cker wrote: »

Its probably better to struggle on with that level of debt if you possibly can. You need to have at least 3 creditors to qualify for an IVA.

Ive seen much bigger debts in IVA's it looks a better proposition at the higher end of the scale to me.

Most of the advice here seems to be against going for an IVA as there are many cases where they are miss-sold-the firms charge high fees- to people who would be better going for a DMP.

I have at least 10 creditors and i have tried a DMP for the last 2 years and seem to still be sruggling to make monlthy payments

wendywoo1982

Nargleblast wrote: »

Suggest you contact CCCS (Consumer Credit Counselling Service) as they can go through your options with you. You could go down the Debt Management plan route rather than IVA or Bankruptcy, but they will be able to look at your circumstances and tell you if it is feasible. They have a website you can go on for more info. They are also a debt counselling charity so their services are free, do not ever go to a firm that charges you. (If you did go down the IVA or BR route then there would be charges but you would be fully informed about that side of things).

I have been on Trapped.co.uk and they said an IVA was my best option and put Baines and Earnst in contact with me and they also said it was my best option of paying my debt off in a min of 5 yrs. Do i trust these or not?

Leixlip1

As`per Nargleblast's post - use a non-fee paying/charity like CCCS, CAB or National Debtline to get independent advice.
A fee paying company like Baines & Earnst will want to make some money from you somewhere along the way so MAY not give wholly independent advice and may push you towards an IVA. I had a similar experience a couple of years ago and finally found this site, took independent advice from National Debtline and run my own DMP.

wendywoo1982

Leixlip1 wrote: »

As`per Nargleblast's post - use a non-fee paying/charity like CCCS, CAB or National Debtline to get independent advice.
A fee paying company like Baines & Earnst will want to make some money from you somewhere along the way so MAY not give wholly independent advice and may push you towards an IVA. I had a similar experience a couple of years ago and finally found this site, took independent advice from National Debtline and run my own DMP.

I have been looking on the national debtline website today which was quite useful. Now you say it the guy on the phone did make me feel like an IVA was my ONLY option, so kind of agree with you about pushing me towards one. I think i will go down to my local CAB and see what they say before i agree to anything. Thanks very much for your input

RAS

Remember that even doing a DMP via Baines and Ernst costs about 17.5 percent of each payment as fees. If you pay the same amount to a debt charity, it all goes to your creditors and pays your debt off faster.

An IVA cost about £6-10.000.

Nargleblast

If you decide to go for an IVA then CCCS have a link with CCCSVA, who do IVAs. Maybe the other debt counselling charities also have links with reputable IVA companies who won't rip you off. That is an important point because some IVA companies charge so much that you could be paying into the IVA for a year or even 2 years before your creditors get a penny back, and that is unlikely to appeal to them when they are asked to vote on your IVA proposal.

Deep_In_Debt

Payplan are also another company you can try who won't rip you off and will advise in your interests.

Don't touch Baines & Ernst with 100ft barge pole! They will recommend an IVA to you as they will make loads of money from it when there could be other options for you.

Also, an IVA generally lasts for 5 years. A lot can happen in 5 years and if your IVA fails, it could result in bankruptcy.

Nargleblast

Whichever you decide on - debt management plan, IVA or bankruptcy, it is up to you to follow the rules and make it work. This is where the debt counselling charities come in useful, for guidance and support. I have heard people say that going bankrupt was the best thing they ever did! Others have said thank goodness for the IVA or the DMP or whatever they chose to do. This is why I can't emphasise enough how important it is
to talk to CCCS/Payplan/NDL etc, as they can advise you without ripping you off.