IVA advice please

plonker9

Hello,

I hope you can help.

I'm facing up to my debts and looking for some advice

My situation is

£152k mortgage (value of house approx £155K)
£20k personal loan with mortgage provider (this is a NR together product)
£16K Barclayloan
£14K Tesco
£15k Virgin CC
£6k Barclaycard CC

So around £71k unsecured personal loans

My current income is around 2400 per month nett
my current outgoings is around 2400 per month nett (inc loan repayments)

I'm thinking an iva is the way forward??

also i'm self employed and my income varies . How does that work in a IVA?

Any help gratefully received

thanks!

immoral_angeluk

What is your expenditure before your debt repayments?

WASHER

IVA's are suited to very few people, Martin Lewis has some info on them, I will find it and post.

You could of course contact a debt charity like the CCCS or Christians against poverty, they will advise you free of charge.

In the meantime, you could post an SOA (incomings and outgoings) and we will see if we can reduce your outgoings in order to meet your debts.

I'll post the links in a mo to the SOA calculator and to Martins article on IVA.

WASHER.x.

WASHER

http://www.makesenseofcards.com/soacalc.html

SOA.
http://www.moneysavingexpert.com/loans/pdf-iva-guide.pdf

Iva guide from Martin.

plonker9

im-angle,

around £1800

plonker9

thanks washer

DarkConvict

I don't know much about IVAs, but they are used to protect assets like a house / car, as i can see you have only £3000 equity in the house, compared to the size of debts i wouldn't think it would be suitable, a DMP might be a better option.

cameron1

Hi

Having recently discussed all this in detail with the CCCS i was told the following - with an IVA, whilst your house is safe, at the end of the IVA your creditors can request that you release the equity or a percentage of the equity to them.

"Generally" they would be looking for you to have more than £5000 in equity.

If you only have a small amount of equity OR your mortgage company wont let you remortgage, your creditors can request the IVA be extended for a further 12 months.

It was also explained to me that IVA's are not a given. You have to be able to make a reasonable monthly contribution for your creditors to agree to it and they will want to see that you have cut your expenditure to the bare minimum. You will not be allowed any luxuries at all. Given that you have £600 per month disposable income to put towards your debts, over five years this would amount to £36,000 which is roughly 50% of your total debt.

If it was extended by a further year as you could not release any property equity it would be £43,200 which is roughly 60% of your total debt.

I was also advised that my creditors would want 50% of ALL overtime i earned and any bonuses/pay increases.

Educate yourself about both options. There are pros and cons for both IVA's and DMPs and its a personal choice. After much research and discussion with CCCS, my feeling is that a DMP is better suited to me. The DMP offers IMO a little more flexibility and allows for you to make higher repayments when you can, thus reducing the balance quicker and reducing the length of the plan. However, the DMP does not offer necessarily offer you the piece of mind an IVA does as your creditors can still chasey you.

Please keep in mind this is all info i was told by the CCCS. I am not a professional in this field

OrangeFairy

I would definitely seek further advice. My partner completed an IVA and it worked well for us. However we did not have a house so it was a lot simpler. We paid it off a year early in the end and now it is completely off his record.

If he had overtime they would always ask for half of it. In which case we had to either pay it or show we needed it. One time he had £300 overtime but we were able to prove for this overtime we had incurred extr childcare costs and also his glasses cost £300 which isn't included in the budget they work out for us. So we didn't have to pay anything over.

I would definitely seek more advice...DF read about people having troubles with IVA's and having a mortgage but we were okay as we didn't have one!