Seriously considering the IVA path

ste_coxy

Hi guys, I am in a bit of a pickle at the moment. Your advice would be greatly appreciated.

Short story is that I have debts totalling around £18k.

Comprising of an Egg Loan which I defaulted on about 2 1/2 years ago and which they have frozen the interest on - there's about £6500 left to pay and they reducing the payment to £127.

A Smile Loan which I took out to pay off 4 credit cards and 2 student accounts I had - there's about 2 years left approx £6700 left on that paying £294 a month.

There are said students accounts which I racked back up again stupidly - one if £960 overdrawn and is now being charged interest on as it's a graduate account and the other is £1970 overdrawn, thankfully no interest has been charged on this yet.

I also have a Marks and Spencers Credit Card which I totted back up to its current balance of about £1600.

Finally, I have my current account overdraft which is £300 and I seem to be constantly in this although it is interest free.

I just about manage to make payments to all of my outgoings however, I do not seem to be getting anywhere with paying my debts off - just seem to be in the same position I was in last year. I just feel like I'm going to be 30 and still be debt riddled.

I've tried using the SOA and snowball thing too but I am finding it very hard to follow.

I am going to contact Payplan tomorrow for some advice as I think I really need to do something soon with it coming closer to Xmas. Sick of worrying over money. I am trying to get a 2nd job to fit around my day job but so far it has been fruitless.

I'm really considering an IVA and was just wondering if anyone knows is it likely to be accepted by my creditors as to them I probably seem a good payer - always paying on time, not missing payments but I am barely getting by - my accounts don't seem to getting paid off coz of the interest and the poltry sums I am paying towards them.

Any tips would be most appreciated!

Here is my SOA:

Statement of Affairs and Personal Balance Sheet
Monthly Income Details
Monthly income after tax................ 1250
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1250
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 337.5
Management charge (leasehold property).. 0
Council tax............................. 59
Electricity............................. 16
Gas..................................... 0
Oil..................................... 0
Water rates............................. 17.53
Telephone (land line)................... 8.99
Mobile phone............................ 22
TV Licence.............................. 6.06
Satellite/Cable TV...................... 0
Internet Services....................... 7.5
Groceries etc. ......................... 60
Clothing................................ 0
Petrol/diesel........................... 40
Road tax................................ 0
Car Insurance........................... 60
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 83.12
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 10
Entertainment........................... 100
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 827.7

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

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
Natwest Graduate...............1975......30........17.81
HSBC Graduate..................960.31....20........18.9
M&S Credit Card................1577......39........19.9
Coop Bank Loan.................7029.6....294.......9.9
Egg Loan.......................6435.52...127.2.....0
Total unsecured debts..........17977.43..510.2.....-

Monthly Budget Summary
Total monthly income.................... 1,250
Expenses (including HP & secured debts). 827.7
Available for debt repayments........... 422.3
Monthly UNsecured debt repayments....... 510.2
Amount short for making debt repayments. -87.9
Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -17,977.43
Net Assets.............................. -17,977.43
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.

As you can see I'm falling short at the moment however, my £300 overdraft with my bank has been helping - just feels like I'm borrowing off peter to pay back paul each month and I want to get out of this rut badly.

ToffeeBlue

Might be worth considering. It is 5 years at least though, so make time to consider everthing before you decide. Some of your expends are quite low, I presume you share perhaps. Company will probably advise of allowables. The car insurance seems high and would have thought you need to include road tax for sure.

ste_coxy

ToffeeBlue wrote: »

Might be worth considering. It is 5 years at least though, so make time to consider everthing before you decide. Some of your expends are quite low, I presume you share perhaps. Company will probably advise of allowables. The car insurance seems high and would have thought you need to include road tax for sure.

Only thing putting me off is the thought of ruining even further my credit rating, as with already having a default I would obviously then need to default on the other accounts I've got for an IVA to work. Having that looming over me for 5 years + the 1 year after it for it to be settled is quite daunting.

Are creditors likely to accept anyway if I am managing to make the payments each month as so far I have not missed any?

Yeah, I do share - was going to move home to my parents however, I opted to stay but I am regretting that now.

As for my car, I am considering taking it off the road (it's my dad's old car) however, I have paid for the insurance in full so I am not 100% if it is worth it as will end up loosing out by cancelling the insurance? I had an accident a couple of years ago so lost my no claims bonuses. The road tax has already been paid for this year.

debtinfo

The question is can you really afford your debts or are you just able to pay them because you still use some credit each month

ste_coxy

debtinfo wrote: »

The question is can you really afford your debts or are you just able to pay them because you still use some credit each month

this is defo something I have been thinking about, thing is though I may be just about making the payments but I do not feel like I am getting anywhere near to clearing off anything. the loans are obviously a fixed amount but the likes of my credit card and 2 graduate accounts don't seem to be shifting at all because of the minimal payments i make.

debtinfo

I suppose the thing to do is to cut all cards up and stop using any credit and see how you get on, People sometimes seem to be getting buy because they are not really saving for the bills that come irregularly such as car bills, therefore overall they havent got enough money to pay all their bills over the lng run.

themull1

£100 entertainment is a bit high!

lisa701

I'm also considering the IVA route but I'm getting mixed views from people and really need some impartial advice.

Currently got £28,000 in debts which there is no chance of me clearing. They certainly didnt start at this amount but incorrect advice and delays in processing stuff lead them to grow.

Before I was made redundant in 2006 I tried the CAB but they would not offer me any debt advice as it was only open to unemployed people? Went to the CCCS who suggested a debt management plan but its clear that on my current wages the amount I can pay is not going to clear the debt for a long time if at all.

They suggested we sell our house to clear debts but after looking into the figures we would be unable to sell for enough to clear our mortgage and associated selling fees, let alone have anything left over to clear debts. This would leave us homeless and with more debt than the original £28,000.

I just don't know where to turn to for advice.

mtgg

There can be light at the end of the tunnel!

My husband & I had unsecured debt of £86k(13 credit cards/store cards) in 2005 and when we went into the IVA, we had not missed any payments. But, we were living off credit & borrowing off peter to pay Paul in a big way.
We have been paying £498 each month & have paid back 25p in the £.
I work in the financial industry & have a mortgage with my employer! So bankruptcy was not an option.
We also had No equity in our property.

Our IVA finished on Oct 4th after our 5yrs - It has been hard, but we are looking fwd to our October salary, which will be ours & no debt apart from our mortgage & secured loan.
For us our IVA has helped us start a new life - We are just waiting for our completion certificate & can now start to get our credit record clear in then next 12/18mths.

IVA's are not right for everyone, but for us it has now left us debt free after 5yrs.

Kind Regards
Clare :j

Max_1066

Re Ste_Coxy you really need to talk this through with someone such as the CAB or CCCS. The latter would be useful to get your SOA straight as there seem to be several items missing (gas & elec) and a few items appear quite high (entertaining & medical).

I recently completed an IVA and the best way to start was by cutting up all my cards, its just too tempting. Good luck, there's plenty of good advice available on this forum to help you.

p.s. if you already have a default on your credit file it's already been damaged I'm afraid.

lisa701

mtgg wrote: »

There can be light at the end of the tunnel!

I do hope there is light at the end of the tunnel Clare. At the moment we only pay £140 towards credit as we are on the debt management plan with the CCCS, but that £140 is not enough to clear the debts, it will take many years and I don't know how long people will accept such payments.

I really feel like giving up and walking away because life just aint worth it anymore. I'm working long hours for nothing and the whole situation is putting me under a lot of stress. Just got to find someone independant to go through it all with me, tell me all the pros and cons and then I can decide if its for us.