Decision time???

Flattery26

Hi all, have followed the forums for a while but only just joined.

Bankruptcy or IVA?

Bit of a complicated situation, but eager for opinions...
The time has come to make a decision, jointly with my fiance, including negative equity in a property which is rented out (£20-£30k), mortgage to rent deficit of £400, Personal unsecured debt of £70k and £2k in benefit arrears owed. All come about through prices dropping, redundancy, bad decisions, over spending and a bit of bad luck!

Having received advice on bankruptcy it makes sense, but with a few more hours at work I believe I can have a surplus income of £200 for an IVA.

I live in a nice rented house, in a nice area with my Fianc!e and our two beautiful kids 3 and 1. I really need a way out and a fresh start.
I have had arrangements in place with £50k of creditors for 2 1/2 years, which haven't been a problem, but the mortgage is due to go up £400 in may and I'm 1 month in arrears. The rent is £525 mortgage £925 plus insurance.
My finacees Unsec Debt has always been paid as Ive tried to keep her credit record intact. But she is on the mortgage and facing giving the house back would mean her being dragged in to it.

Theres no real chance of making any reasonable kind of arragement with all creditors including the mortgage company that wouldnt leave us strugging for 20 years. Other than that I beleive our decision is IVA or B?

Any advice would be appreciated..

Tixy

Hi

Have you had advice from one of the debt charities yet?
Just from what you have posted my first thought would be you might struggle to get an IVA approved at 200 a month for debts of 70k - plus how sure are you that you could regularly get the extra hours at work to may that level of payment. But I don't have much experience with IVA figures. Might be worth posting on the IVA board and or the bankruptcy board for some advice from people who have been through them.

Flattery26

I have been speaking to the CCCs since I was made redundant two and a half years ago.
Their Iva dept have said that they would try an offer of 8p in the pound, but no promises.

Tixy

Well I know a lot of people who go through BR find its nowhere near as scary as they thought it would be. Thats not say it wouldn't be life changing but it might still be the most appropriate option for you and allow you and your family to move forward. The fresh start.

Would partner be able to take over the mortgaged property alone? Or would it mean she would end up needing to consider bankruptcy as well?

Why is mortgage due to go up by so much a month? it seems like a big increase? are you coming to the end of a fixed rate deal? Could you switch to an interest only deal to try to keep the costs down until the house rises in value? or can you not opt for that due to your credit rating?

Edit - Well 8p in the pound would be great if that was accepted, I suppose you could try for that and then if not then revert to the option of bankruptcy?

Flattery26

Why is mortgage due to go up by so much a month? it seems like a big increase? are you coming to the end of a fixed rate deal? Could you switch to an interest only deal to try to keep the costs down until the house rises in value? or can you not opt for that due to your credit rating?



I've been interest only as a concession for a couple of years and the say that it cant continue.
I have already defaulted on the £50

Appreciate your comments Tixy