Spend It or leave it??

Governor8777

Hello all,

I am just after some advice, I am in the first process of maybe going in to an IVA, when I say first I mean I have only sent my Income and Expenditure in so I have got a long way to go yet, now this might be a stupid question but here goes, My credit cards still have a few grand left on them and if I spent them (not up to the limit but not far off) could there be a possiblity that this could back fire on me and not get approved for the IVA, the reason why I am thinking of doing this is to get a new kitchen in as I know as soon as I sign up for this there is no chance of me being able to afford to do that after.

As I said above yes it may be a stupid question but I suppose someone will tell me if I am or not!

Thank you

FoggyBrain_2

Well, to be honest it won't be looked on in the best light by your creditors, or, possibly by your IP, as you have to present reasons why you are in your present predicament in your proposal. Having said that -- as, by the time people enter an IVA, they are in the cycle of robbing Peter to pay Paul, it isn't unusual to see cash withdrawals just prior to an IVA........ the purchase of a kitchen showing up wouldn't be so bright.

However, and you won't want to hear this

---

buying stuff you couldn't really afford is likely to be what has brought you to this point in the first place. Do you really need a new kitchen, or is it the case that you would LIKE a new kitchen ?

Governor8777

Thank you for that Foggy Brain, If I don't ask I won't know! As for the question, Do we need a new kitchen, Yes! but I can see your point, on the other hand I am in the process of going through a "Right to buy" and I might be able to get some extra funds to get a kitchen that way, just don't want people thinking i'm trying to pull the wool over there eyes!!

I have told the people at Melanie Giles about me wanting to buy the rented property I'm in at the moment as the price they want for it is, well I would call a bargain! just concerned of getting a mortgage with the bank that most of my debts are with then it all going wrong for me/ us! could there be a possibilty of them taking the house of us If i buy the house then go through an IVA?

thank you once again.

FoggyBrain_2

They will want their share of the equity in due course, but this will be explained by Melanie or one of her team. Because of the discount at purchase there will be enough equity to interest your creditors. They won't take the house in an IVA, but will ask you to attempt to remortgage in year 5, if the equity is more than £5k. Currently it is impossible to remortgage (and likely to be the same in 5 years time), especially as you will be in an IVA. In the case that you cannot remortgage, this is usually addressed by extending the IVA by 12 months.

I have seen a few people who have loans in their IVA's and also mortgages with the same lender, who have no problems with the mortgage side of things.

To be honest, if I were in your position, I would go for the RTB while it is still possible ---- the way things are being cut by the gov't they might stop the discounts altogether in the future.

Foxy-Stoat_3

IVA/BR etc are a last resort really. If you still have a few grand on CC's and spend it just before enterinig into an IVA, it could be considered fraud. Its not good taking out loans for £50k say, then a week later going BR, bit extreme I know.

If you say draw out a few hundred a month and keep the money aside for the kitchen after you buy the place, then I dont think that would be considered in bad light. As you could easily say the cash is for paying off minimum payments on other cards, as I assume that this point money is being swopped around every month to keep them all "happy"?

I wont be making any major purchases before entering an IVA, they probably wont want the goods back but it will look bad if you bought 2 50 inch LCD tellys and a new corner sofa weeks before a creditors meeting and the company brings it up !

Good luck chap.

Governor8777

Thank you for that Foxy Stoat!

Sounds a good idea taking a few hundred out after I buy the property but knowing my luck it would back fire on me!! I suppose there is only way to find out.
Maybe I might have to give the kitchen a miss and just be thankful we got a roof over our heads!!

thank you for the advice anyway.

Same to you Foggy Brain, Thank you......

snicz

It's completely normal for you to want to max out your credit cards before 'taking the plunge', after all, unsustainable lending is the creditors fault too.

As for "However, and you won't want to hear this

---

buying stuff you couldn't really afford is likely to be what has brought you to this point in the first place." A lovely philosophy but lets be real here, most people 'can't really afford' bloomin groceries these days without the overdraft so should they starve? Of course not.

Only you really know what you need and what you don't but rest assured, you won't be judged for it on here from anyone who knows what you're going through.

Good luck

Governor8777

Hi Snicz

Thank you for your advice, I completely agree only I know what I want and what I don't want, there's alot of things I want but I have made sure I am not giving in to it. I only have myself to blame for the mess that I am in and I have tried to get out of it, whether it is taking a loan to clear the debts or taking a balance transfer at 0 % to help but I'm seem to end up back at square 1!!

I'm sure people will agree you have your good days and your bad days, seems to be a hell of more bad days recently and I feel as if it is affecting my relationship, this is why I am anxious about going through an IVA cos the last thing I want to do is try and sort everything out then it back fire on me and everything just goes from bad to worse!!

apologies, not looking for sympathy or anything like that, just it seems easier writing about the position your in rather than talking about it.

FoggyBrain_2

snicz wrote: »

It's completely normal for you to want to max out your credit cards before 'taking the plunge', after all, unsustainable lending is the creditors fault too.

As for "However, and you won't want to hear this

---

buying stuff you couldn't really afford is likely to be what has brought you to this point in the first place." A lovely philosophy but lets be real here, most people 'can't really afford' bloomin groceries these days without the overdraft so should they starve? Of course not.

Only you really know what you need and what you don't but rest assured, you won't be judged for it on here from anyone who knows what you're going through.

Good luck

Hmmm .. let's see groceries or starve ... new kitchen or starve ... doesn't really fall in the same ball park.

Not making any judgement snicz -- Gov asked for an opinion and I gave one .. simple as that.

Been there, done that, got the IVA

Governor8777

Oooooooppps what have I done!!

I'm not wanting to cause any arguements here, I do appreciate everybodys comments, to be honest I am totally new at this so any advice and comments are greatly appreciated. The last thing I am going to do is judge any oppinions that are given to me, I was more concerned about people judging me.

If I don't ask I will never know.

Thank you once again.

FoggyBrain_2

You are not going to be judged Gov -- we are all in the same boat here. Snicz, just caught me at a bad time ... had an announcement at work which has lost me a potential £7k a year in pay.