quick q...do you have to be in arrears to do iva

POSSETTE

As headline says...other half is only just scraping by to give CC and loans the min payment..he is going to struggle soon as divorcing and he gets nothing...so does he have to be in arrears or can he start an iva now ?
Thank you

adfax

Hi

The short answer is no - he doesn't need to be in arrears. But he does need to be insolvent.

If his outgoings - including minimum debt repayments - exceed his income then he is technically insolvent, and therefore he would be able to apply for an IVA.

The best advice is to speak to one of the debt charities, and do an SOA. They will tell him what is the best way forwards.

I know when I first spoke to CCCS they worked out minimum repayments based on a percentage of the debt - which worked out a lot higher than the minimum repayments set by the CC companies. With some of my CCs, the minimum repayment set by the company only just covered the interest and didn't touch the capital. CCCS worked it out based on a percentage that would get the debt paid off - eventually!