Should I just try and negotiate with creditors or go IVA????

debtfree2016

I have 2 credit cards in my name toatalling £13k currently paying £300p/m (Barclaycard/Tesco)
A loan of £31k inc all interest to be completeed Oct 2016 currently paying £449p/m (HSBC)
A loan of £3.7k inc all interest to be completed Oct 2012 currently paying £174p/m (Blackhorse Car)
A loan of £1.2k inc all interest to be completed Feb 2012 currenyly paying £102p/m (Blackhorse)
A loan of £6k inc all interest to be completed Oct 2012 currently paying £345p/m (CitiFinancial)
My mortgage is £213k
As you can see i have loans that finish within two years, equity in the property would be £36k but that would mean a 100% mortgage. I don't want and IVA unless it's the last resort, cards are not being used and i have no intention of using them. I have never missed a payment in loans or mortgage and probably late once or twice on the cards due forgetting not on purpose.
Thanks in adavnce for any advice

FoggyBrain_2

Hi Mark ... got your message, but will reply here. Now, a lot depends on your income and other expenditure to see what your disposable income actually is and how tight things are.

If, as you say, you want to avoid IVA, a DMP looks promising. What I would suggest is first to have a chat with a couple of debt advisors / IP's ( a list of reputable companies can be found at https://www.iva.com) for more specific advice.

My thoughts are that you could enter into a DMP to get you smaller loans out of the way, by snowballing the payments. Basically this means that you pay more to the smallest loan ( while also keeping the bigger creditors happy ) when that loan is gone, you use their repayment to attack the next biggest ... and so on, until all your repayments are going towards the last, biggest loan). However, getting creditors to agree might be difficult as they tend to like their fair share right from the start. Indeed, arranging a DMP your self is mightily difficult. Also the creditors are not bound to stop interest charges, nor to stop harrassing you.

If you can tough it out for 18 months you will be around £650 better off already.

Your level of debt is similar to mine -- and my repayments work out (being my disposable income) at around £450 per month over 5 years --- yours could be more or even less.

With regard to the equity ...... the figure will be worked out on a forced sale basis, therefore the value of the property will be 85% -- less the outstanding mortgage .. will be the actual equity --- that might go up or down over the next 5 years. If it falls to less than £5k it will be disregarded.

On a modern (protocol compliant) IVA, if you have more than £5k equity, you will be asked to attempt to release it into the IVA in the last year. Being in an IVA will make it nigh on impossible to raise any money (nobody will lend to you!), so the "loss" of released equity will be addressed by adding 12 months payments to the term (which usually works out less than the equity would have been).

Confused ???? As I said -- ring a few IP.s and get a feel for them and the advice.

Best of luck

debtfree2016

Thanks FoggyBrain..
I will contact a couple of IP.s and reply with some news