IVA - Was I Missold?

charleem_2

I've been in an IVA for just over 3 years now and have 2.5 years to go as it was extended when I was off sick.

I work for a non financial related company and colleagues have gone bankrupt without any issues and have kept their jobs so I'm not worried about that.

I have no assets, I have about £2800 in a pension fund through my current employer and this is the first pension scheme that I've ever paid into, when I say I have no assets I really mean none at all, no savings, no property, no land, no premium bonds etc, the house is 100% owned by my partner I just rent a room, I've never paid anything towards it, infact the house was paid off before I even moved in, with this in mind should I have ever entered into an IVA? I feel I'm paying £330 a month for nothing, I've no other disposable income and things are getting tighter as I've not had a pay rise in 2 years due to the recession.

Any advice greatly appreciated, I'm seriously considering not paying anything else and waiting for one of them to send me bankrupt.

trudij

Right at the start, you should/would have had bankruptsy explained to you at the same time as they went through the IVA proposal.People pick an IVA for all sorts of reasons - I only know that the reason I went with an IVA was a small part of wanting to have another horse at some stage in the future,and I know when you register as an owner,they ask if you have been br (but I dont know if it makes any difference - the racing world is full of crooks of one sort or another!!) but I picked IVA mostly because I had used the money I was owing,and I wanted to pay as much back as I possibly could,without it taking forever. Yes, I could have gone br,and it would have been over quickly, but I would have felt too guilty about the money that I didnt pay back.


I very much doubt you would have been "missold" your IVA - but if you have now changed your mind/circumstances, then not paying for 3 months i think will fail your IVA.... you wont be a whole lot better off though I dont think, cos your default thing will restart from the start of your bankruptsy, so you will have ANOTHER 6 years with it on your file. If you only have 2.5 years left of your IVA it might be better to stick with that?? Im sure someone with FAR better knowledge than me will be along to help you out though - dont take what Ive said as gospel !!

Have a chat with the CAB or someone (probably who isnt your IP would be best!) and see what they say.

charleem_2

Hmm that's just it, bankruptcy was never explained to me when I went into the IVA, all I was told by Debt Free Direct was that bankruptcy was a complete last resort and not something I should consider, that was the end of it, they made it very clear that an IVA was something I should be going into, so I took their advice.

Having thought about it over the years and realised that I really do have nothing to lose then why the heck am I in this thing?

I have them ringing me tomorrow and they say that they'll discuss everything with me including bankruptcy, I dare say they get more £££ by keeping me in the IVA.

debtinfo

I presume you did read the IVA proposal which explained the difference and which you signed for the court and creditors stating that you understood

Charco_2

Charleem, they probably do earn more by trying to keep you in an IVA but if you've been in the IVA for over 3 years then most of the fees have already been collected.

The big fees occur at the start of the IVA and thereafter they would collect a fee of probably £400 or £500 a year to supervise your case... which isn't a lot really considering the work that does go in to it.

They should earn nothing more if you decide that Bankruptcy is now the way forward for you. Nobody should! If anyone tries to charge you to take you through BR then walk away. You can get free help if you need it but really the BR Forum next door is as good as you'd need.

There are companies also that spring up offering to "help you out of your nasty IVA and into BR which really should have been your preferred option anyway"... avoid these companies! They will charge a fortune to do something you can do for free. They do not understand your case and do not know if BR is a better solution for you.

You simply stop paying your IVA, after three months your IP will fail your case. (it is unlikely that anyone will pursue BR on your behalf becasue there is no value to them in doing so... if you had assets etc then they might consider it but there's no way they are going to spend their own money essentially freeing you from your liabilities to repay their money to them!) You will then need to file your own BR papers (cost around £510)

For my tuppence worth i think you're probably better off seeing out your IVA, if it has become unaffordable then insist that your contributions are re-calculated.

charleem_2

Oh I don't know what to do

I'm sick and tired of handing over all this money every month for what feels like nothing, I don't feel I owe the banks anything as it's them that put me in this place refusing to help me when I was made redundant and slowly removing their facilities from me, making me dig myself into a bigger and bigger hole, everything was fine until I lost my job, then mint removed my credit facilities, things were plodding along fine and then everything just went to hell, they all started slowly putting the pressure on.

I don't have anything left after paying the IVA, rent and bills every month and I've nothing to show for it. I've got crap credit, but at least if I go bankrupt then they can all go to hell for their money and I'll be a few hundred quid better off each month to start enjoying my life again instead of living hand to mouth.

Thanks for all your opinions guys, still dunno what to do though!

publandlord

they are cowboys they tried to get me to have an iva even though all my income was from benefits

Charco_2

Speak to them about your Income and Expenditure again. Insist that it can't go on like it is.

If you can, post a copy of your I&E up here and I'll happily give it a once over to see are there any other allowances you could be getting. Then if there are any changes, insist that they put forward your revised I&E with a reduced contribution.

If you don't think you'll ever require credit again then certainly consider BR - BUT THINK VERY CAREFULLY! (I dont really mean "ever again", just a VERY long time, it will be like resetting the clock!)

Just put it very plainly that you can no-longer afford your IVA, you're thinking about Bankruptcy but you're willing to give it one last go and would your creditors accept £200.

(remember, going BR you may be required to pay this amount per month anyway but it would all be eaten up in fees)

charleem_2

I've been on the phone to them to discuss everything today and they've managed to get my payments down to £240, giving me £90 a month breathing space, phew.

Just 22 payments left and then I'm free, can't wait!

Max_1066

Well done, it was def worth the tel call.

For what its worth I think you've made the right choice under the current circumstances. Good luck.