*De-Lurking* So ashamed of our debts, will we ever be free?

yorkieone

Hello to all you lovely posters, I felt it was 'time' I de-lurked and introduced myself!
These boards are brilliant, they have given me so much knowledge and encouragement along the way and I really don't feel so alone anymore. Thank you to you all.

My story is long winded but here goes! (so sorry if this bores anyone)
4 years ago I started my own business, it was a success and of course we started to reek the benefits and lived to our means. My husband eventually quit his full time job to come on board whilst we were expecting our 2nd child. We eventually changed the company to limited, and in time employed 3 full time members of staff. We should have gone limited in the beginning, but hindsight is a wonderful thing?!

2009 was an incredibly difficult year, both business and our personal lives became affected. The economic climate really started to hit us hard, business wise. Personal wise - Our little girl (then 22 months) was diagnosed with a chronic illness that has just changed her life, and ours completely. Obviously this rocked our world, I took my eye off the ball for a short time, business wise because I just needed to come to terms - and of course care for my little girl's health.

If this wasn't enough to deal with I lost my father just 4 weeks later. It was so sudden and unexpected, again this completely shattered my world.

Our company started to struggle even more, I was so focused in my own grief for my loss and I lost all heart and aspirations for the business that was already, by then a growing concern. When I eventually mustered the energy to focus, by this time it was too late, we became insolvent In September 2010 we ceased trading, there was no alternative. To be honest it felt like a huge weight had been lifted. No more companies chasing us for overdue invoices, wondering how we were going to pay our staff. We couldn't take a wage ourselves for the last 4 months and this really had started to take it's toll on our personal finances.

'Most' of the company debts were left behind with the limited company. However, personal debts are roughly £54k each. At least 70% of this debt is from the business, i.e business credit cards, business overdraft, but were never transferred to the limited company status We had to use a lot of our personal credit cards to help the business survive, I regret we ever did this.

We're in a DMP with Payplan at the moment but realistically our income has reduced dramatically, we probably won't ever match what we used to take home. We're going to be paying into a DMP for the next 20+ years at £460 per month.
At the time we never considered an IVA or BR. I've never been in debt before and I guess I was just so thankful that Payplan were there to help us and negotiate with our creditors.

Some of the creditors have been fine, without a whimper have accepted a lower payment. However 2 of the least owed to have been the most awkward and will not accept lower payments, have taken it to court. Because Payplan didn't deal with the court papers on my husbands behalf in time he received a CCJ last month to our shock horror!!

We've now just completed step 1 of entering into an IVA, I just wish we had considered this earlier. This whole process is really worrying me though, will the creditors accept because its such a large amount of debt? Our mortgage outstanding is £98,000 and I believe house prices are roughly £135,000 - £140,000. My biggest fear is that they will take our house in year 4 if we can't release any equity. Who in the right mind would re-mortgage us??

To top everything I was also in court last week related to a debt outstanding to the limited company, but taking me personally responsible. To cut a very long story short the judge decided that I was personally liable, a further 11K debt! Apparently this can be included in the IVA. I gave evidence of my financial circumstances to the judge, re the IVA - the claimant commented that they sometimes consider a 'charge' on a property. In interest of both parties the judge ordered the debt to be paid in 14 days, in the view this can be settled between ourselves out of court. I'm really worried that they'll ignore the fact we're going for the IVA and apply for the charge once the 14 days is up.

Life just seems so very dull at the moment, the thought of losing our house underneath our feet is a scary prospect.

My husband as ever refuses to 'talk' about our problems, he clams up whenever I try to broach the subject and we end up having a full blown argument. He's still self employed but chasing something that just isn't going to work. He hasn't brought in a wage for 6 months but 'believes' it will provide an income :mad:. I'm now at the point where I don't know where our marriage is going anymore, I've tried so hard to persuade him otherwise but I just feel I've lost a lot of respect in him. He can see how unhappy this is making me as I feel I'm the one bearing all the debt worries, but he's not willing to make this right for me and our 2 children by simply getting a job. I know jobs are hard to come by and I don't expect he can walk into one tomorrow but I would like to see him search for one at least.

I'm sorry this is soooo long winded, I wanted you to get an understanding of why we have ended up where we are today. As said in the beginning, in 'hindsight' I would have done things so differently if I knew then what I know now lessons learnt though and I will never make the same mistakes again.

Thank you for taking the time to read this but well done if you made it to the end! :T

x

mtgg

HI

I am really sorry to hear what you have been through & are still going through.
My husband & I started an IVA in Oct 2005 with a wooping £86k if unsecured debt!
We also did not have any equity in our property.

We have now completed our IVA last Oct & are now in the process of clearing up our credits files, so that when this oct comes, we will only have our mortgage & secured loan and will have a A1 credit file.
So things do get better I promise.

Things will get better, it just takes time:j

Take care
:beer:

FoggyBrain_2

Hi there, an IVA, these days, properly drafted and proposed, will not force you to sell the house to raise equity. The norm now is to require you to ATTEMPT to release equity ( if there is any) towards the end of the term. 9 times out of 10 this is impossible and so is addressed by adding 12 months to the term ( which usually works out cheaper for you).. If the equity (at 85% LTV) is less than £5k it is usually excluded and the IVA completes without the extension.

yorkieone

Thanks for your replies, It's really appreciated.

I think I've realised there is no point in making yourself ill over something that's in the past that can't be changed. I hope the IVA goes through quickly so we can just get on and start rebuidling our lives