What are the negative impacts on your life if you go Bankrupt versus IVAs?

money_friend

Hi my husband is £28k plus in debts and rising due to interest and late payment charges etc, he is employed now and he has no assets (no mortgage as cant get one, no car as it was on HP and taken off him, no mobile as it was taken off him as not made payments, only a basic bank account as his overdraft and credit cards been stopped as debt owing etc, and he hasnt been making any repayments (even minimum ones) to his many creditors) - basically he has his head in the sand and wont address the situation. I feel him going bankrupt would be the best option, to clear his debts in one go, leaving him unable to get credit for 2 years and make him learn to budget/ live within his means. He reckons he can get a loan in a few months to pay off his debts and just pay one sum per month for that loan (given his history, i really do not think he will keep up repayments and will get in an even bigger mess), plus by the time he gets round to doing anything about it, it will be about 6 months, if he goes bankrupt now he will soon be out of it by 2 years. yes i know it stays on his credit file for 6 years, but he cant get credit anyway.

just want to make an informed decision; what are the true impacts on your life of being bankrupt? or having an IVA? e.g. Bankruptcy lasts two years, it costs X amount, it is listed in the local paper, it may affect your job if you are a solicitor or company director etc (he is a manual worker), it stays on your file for 6 years, your mortgage can be taken into account (he doesnt have one) etc

has anyone been through it? any personal experiences or advice?

Ames

Really don't think he'll get a loan if he's been missing payments on existing debts! But if he's turned down it might be the wake up call he needs.

Bankruptcy normally lasts a year, costs about £400, it's listed in the local paper and one in London, it stays on file for 6 years. I nearly went through with it but realised there was no point. If debt is due to gambling then there can be a bankruptcy order which can last up to 15 years.

IVA's are only suitable for a very small number of people. Usually it's only done if there's a house or assets to protect, and it's only a small step away from bankruptcy. If it fails then the only way out usually is bankruptcy. Also, your creditors have to agree to it (I think it's something like 40% of the debt has to agree to it), whereas with bankruptcy they have no say.

I'm not sure what the differences are between the amount you get to live on with IVAs or BR.

gfplux

Helo money_friend,

I am unable to offer any informed opinion on your question.

However are you asking it for your husband and he has looked over your shoulder as you typed, or are you doing this on your own.
Many people on this forum, much more experienced than I will tell you that unless YOUR HUSBAND has the light bulb moment, what has caused his debts will just carry on. Even if he goes bankrupt, as soon as he has money he will be spending again.
Debt normally comes by spending MORE than you EARN. We all know that but sometimes we can not see the wood for the trees. If you (he) want to get out of debt you have to change that habit today.


Good Luck,
looking forward to your next post.

rayday2

There are other options and I would personally speak to one of the debt charities, see what they say and then think about it again.

money_friend

to gfplux - thanks for your response - i am writing this, my husband is not here. we have infact separated because as you mention, i cannot see that he will ever change, and even if he went bankrupt i think he would get a car loan etc once he is able to again, but im hoping not being able to get credit for 2 years etc would be his wake up call that he has to grow up and manage his money at some point in his life. we have a young child and one on the way, so i need him to go bankrupt so that his income from his job can go on the necessities like childcare & bills etc, instead of to all his creditors, or himself! if he wipes his debts then i will get back with him, as i just need him to be a responsible parent now. i work full time and pay all the bills etc, if i can do it, he can do it too!

to rayday2 - i have emailed the national debt helpline as i tried for days to get through by phone but its always engaged, they just sent a lengthy email back about IVAs and i am still non the wiser about him going bankrupt, he doesnt want to do it as he will not be able to get credit for 2 years, but why cant he see that he wont be able to get credit for 2 years as it is anyway. he thinks he will be black listed for 6 years etc.

gfplux

Money_friend
All a bit clearer now.
Are any of the debts in your name or joint names. If not well done.
If he is living apart from you I think it is in your best interests to cut him loose.
Sometimes a man child , always a man child
You cannot force him into bankruptcy only he can decide that.

All very sad.

good luck and best wishes.

Nargleblast

Moneyfriend - give your husband the contact details for organisations such as CCCS or Payplan, as they will offer free advice on debt issues. Then let him get on with it. You have a young child and another on the way to consider - look after your health and that of your children first. Make sure your own financial situation is sound with no debts in your name. Assume that you will be a single parent because until he has his light bulb moment he will be of no support to you. Let him know you are there if he wishes to talk about the situation, but make sure he knows he has to get help before you will even consider taking him back. Hard I know, but you cannot solve his problems for him.