IVA Monthly Repayments

scouselad1974

Hi Everyone

I'm after a bit of advice regarding IVA'S.
I'm currently on a DMP and it's going ok apart from the odd couple of creditors playing silly !!!!!!s, if they continue to not accept my DMP and add interest and late payment charges then I may be forced to go down another route. I don't want to make myself bankrupt as I am a sole trader and my business is starting to pick up.

My main concern is the monthly repayment amount of an IVA, obviousley this is different for everybody depending on their circumstances, but is there a minimum amount like their is for a DMP and is an IVA suitable for a self employed person.

Thanks in advance

Charco_2

An IVA is certainly suitable for someone who is self employed - the idea was originally brought in to encourage entrepreneurial spirit... as in, to give self employed people a chance if things went wrong so that perhaps they could start again.

The repayments are likely to be similar to those you are currently paying in your DMP. (Dont know what you mean by a minimum amount in a DMP - regardless of the solution, you should only be paying back as much as you can afford to)

scouselad1974

Hi

Thanks for the advice, by minimum payment I meant that for instance National Debtline will not set up a DMP for you unless you can pay a minimum of £100 a month to your creditors, otherwise you have to send token payments instead.
I had heard that an IVA would not be accepted unless a payment of no less than £200 a month could be made, I may be totally wrong though.

althas

As you have presumed, it is all down to your individual circumstances. An IP will go through your entire budget, income and ALL expenditure (including things like house insurance payments etc). Then they will take your guaranteed basic takehome pay, deduct all the expenditure allowances and what is remaining will be proposed as your payment

I have heard of the odd ones for less than £200 being accepted, but every creditor also have their own rules

If you are considering an IVA then TALK to someone who will give you an idea as to what in their experience is acceptable. Stay clear of anyone who askes for a fee to discuss things like this. They are generally only in it all for pure money making, and tend not to care about you after you sign

scouselad1974

Hi

Thanks, If I decide to go down the IVA route I will contact CCCS who my DMP is with for advice.

Cheers

Charco_2

There was a recent thread about this on here actually.

It can depend on the IVA company alright and certainly will depend on your creditors!

THE IVA COMPANY
Some IVA companies are simply huge factories drafting hundreds of proposals a month (I know that "FACTORY" a buzzword on here for "they're big greedy impersonal money-making crooks" but that's not necessarily the case). Some IVA Companies are small so it's about economies of scale...
A big company can afford to do a number of IVAs with smaller repayment terms, a smaller company might not have enough staff to do a small IVA so will try to concentrate on an IVA that will pay better. (It's unlikely that a company would turn you away though if you had a viable IVA, but the question was raised on here before. Many IVAs can be done for £150 or less a month, but then you're staring to get down into territory where if that's all you have to spare, then an IVA probably isn't your best option!)

THE CREDITORS
A lot depends on the creditors because they all have different arbitrary rules about what they wil and wont accept as an IVA. Most have a minumum dividend that they will accept (somewhere between 25p and 40p in the £). Others have criteria about homes/mortgages/interest only/capital repayment. One has criteria that if it would take less than 10 years in a DMP then they will reject your IVA (sort of unfair since you can't measure this because you dont know if interest and charges might be frozen or not! Also ironically if you were offering LESS money to your IVA then it's more likely that a DMP would take you longer than 10 yrs).
I also know of one time when it would have depended on your surname (first half of alphabet or second half) whether or not the creditors would have rejected!