Need advice with debt, SOA, IVA the works please

sunshune

HI all

I have just found out that my sister and husband are in an awful lot of debt, she confessed all this morning. She doesn't know what to do and can't stop crying.

Here is the short version

They live in a mortgaged property (interest only)
My brother in law works and she is a SAHM trying to get back into her field but can't. During the time she has been a SAHM they have accumulated a lot of debt £33794 as she can't get back into her field and have had to live off credit cards.

I have tried to do a SOA for her but I am not sure if it is done correctly. Also, I got her to call CCCS and they have advised that until she has found a job and made cut backs by at least £500. As she hasn't been able to get back into her field she will drop the hours her daughter does at nursery but they are tied in for a while because they put her name down a while ago so they are tied in for another month or so.

The advice that CCCs gave her was that she should offer token payments of a £1 to all of her creditors until she gets a job or they can make cut backs such as their phone or sky. I thought they would offer her an IVA but there is no surplus cash available.

She was worried because CCCS suggested if she does this (in fact they strongly advised she does) the creditors can request a charging order against her home. Is this true.

She also called Pay plan who too all her details and said that the best bet would be to offer reduced payments to the creditors and freeze interest and review the situation in 2 months.
I have done her SOA but I am not sure if it is correct please have a look and offer any advice.

Thank you

Household Information[/b]
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 1

Monthly Income Details[/b]
Monthly income after tax................ 1710
Partners monthly income after tax....... 0
Benefits................................ 117
Other income............................ 0
Total monthly income.................... 1829

Monthly Expense Details
Mortgage................................ 370
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 90
Electricity............................. 50
Gas..................................... 50
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 13
Mobile phone............................ 60
TV Licence.............................. 13
Satellite/Cable TV...................... 47
Internet Services....................... 19
Groceries etc. ......................... 250
Clothing................................ 30
Petrol/diesel........................... 160
Road tax................................ 0
Car Insurance........................... 30
Car lease 200
Car maintenance (including MOT)......... 0
Car parking............................. 50
Other travel............................ 0
Childcare/nursery....................... 650
Other child related expenses............
Medical (prescriptions, dentist etc)....
Pet insurance/vet bills................. 0
Buildings insurance..................... 33
Contents insurance...................... 21
Life assurance ......................... 10
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................
Entertainment........................... 25
Holiday.................................
Emergency fund.......................... 0
Total monthly expenses.................. 2001


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0


Secured & HP Debts
Description....................Debt......Monthly.. .APR
Mortgage...................... 0........(0)........0
Hire Purchase (HP) debt ...... 600......(72).......6
Total secured & HP debts...... 600.......-.........-

Unsecured Debts
Description....................Debt......Monthly.. .APR
Barclays loan.................16170.79......440........12.77
Amex 3496.32 250 1.31
MBNA 12,428.26 250 2.2075
Barclays over draft 1650

Total unsecured debts.........£33794........-


Monthly Budget Summary
Total monthly income.................... 1829
Expenses (including HP & secured debts). 2001
Available for debt repayments...........
Monthly UNsecured debt repayments....... 1000
Amount left after debt repayments.......

Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -
Total Unsecured debt.................... -
Net
Assets.............................

debtinfo

Hi, the first think she needs to do is take a hard look at hr situation and assess how realistic it is that she is going to get back into work, if it is not realistic then making reduced payments is just delaying the innevitable, if she is going to get back into work then following the CCCS advice will give her a bit of time to come up with a more long term solution, The creditors will usually accept reduced payments for a while but eventually they are going to push for more

sunshune

Hi thanks for your response. Her husband does not think that paying token payments is the answer either as they are not tackling the debt but if they do not do something otherwise they arejust accumulating more debt. Cutting back the nursery to £250 a month will help along with sky and phone bills then they may have £100 surplus a month could they then try for an iva in her husbands name as the debt is under his name? Br is not an option as he works for th council.

I wanted to suggest whether they should move into our mums to help if they did this could they still do an iva or should they try to get an iva then move to our mums so they get back on their feet?

Thanks in advance

debtinfo

Are you sure bankruptcy is not an option, has he actually checked his employment contract

sunshune

Defintely not an option it is inhiscontract contract they also want their home. An Iva would have been ideal

debtinfo

I think that with only £100 surpus an IVA would be difficult to achieve, have a post on the IVA board as this is more their subject

sunshune

Thank you i have just posted it on the other thread

THank you for your advice