Swapping IVA for bankrupcy?

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I've got 2 1/2 years left on my £55k IVA, but it's just too damned hard. The thought of not getting a proper holiday for another 2 1/2 years, no real Christmas, it's really getting too me just now, so I'm considering ditching the whole thing and going bankrupt.

I initially plumped for IVA because of problems the alternative would create at work, but I've subsequently discovered it is not as big a problem as I thought.

Is it possible?
What are the pros and cons?
Poi

Honk if Pluto is a planet

Comments

  • Nick700
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    Good morning,

    It is possible to do what you are suggesting, and ask for your IVA to be failed and then go bankrupt, which will release you from the burden you are feeling because of your IVA. However there are also some con's involved:

    1, You are only 2 and a half years away from finishing your IVA and thereby having all your unsecured debts written off. If you went bankrupt, it is possible that you will have to contribute your monthly disposable income for another 3 years in an Income Payments Arrangement.

    2, The downsides of bankruptcy, such as risking your home if you have equity in it, and any possible consequences on your future career path.

    3, Having to pay nearly £500 to declare you bankrupt, however some IVA proposals force the Insolvency Practitioner of your IVA to declare you bankrupt so in these circumstances, you wouldn't have to pay the fee.

    4, Bankruptcy will stay on your credit file for six years from the date you go bankrupt. However an IVA will only stay on your credit file for 6 years from the date you entered it, so if you stay in your IVA, your credit rating will improve sooner.

    I suggest you discuss your concerns with your Insolvency Practitioner - may I ask who they are? - a way to change your proposal is to do a variation to your proposal. If there are some good reasons why you cannot afford the payments, need some more allowances in your expenditure and feel you need to reduce your payments, then the IP can approach the creditors with a view to them allowing you to reduce your payments. There is a chance that your IVA could be extended by a year to compensate for the reduced payments, however it will give you more breathing room in your expenditure.

    Hope this helps.

    Nick
  • poi
    poi Posts: 26 Forumite
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    My practitioners are Blair Endersby. They have been truly dire. They rnever reply to letters, they are confrontational on the phone.

    I've already had one variation, extednding by six months, although BE refused to acknowledge this in writing.

    Sounds like I may be better off sticking with it if at all possible.

    Either that or join a dating site for rich women seeking broke lovers.
    Poi

    Honk if Pluto is a planet
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