IVA need help and advice please

georgie14

Hi,

I am new to this website and been looking through all the posts - which are all so helpful.

But i wanted to get some advice before taking the scary step.

I have gone through CCCS and the step advised for us was IVA but since then i have not had the courage to take the next step, the fact i am on here reading about it is a step in its self (already finding this theraputic)

to give you a brief summary my husband and I have £47000 of unsecured debt we bought our house in 2007 and it currently stands at 165k we owe 198k (so there is no equity there) we have no other secured debt. we owe my parents £14000 (which i think is the hardest bit is i know if we go down this route it will be impossible to pay them during the term of IVA - unless anyone tells me different)

the main questions i have are -

how long from contracting an IP does it take to get the IVA set up?
Tesco finance is our largest creditor has anyone had experience of how they see IVA are they likely to agree, second largest is Barclays (unless my parents are taken into the equation)

my husband wages vary dramatically depending on whether he hits bonus (which is not guarenteed) how do they decide what our income is? also once IVA agreed and we get extra income if he gets bonus does this go straight to IVA or what is the procedure?

also i have read that IVA are not joint does this mean we both have to set up IVA or have I misinterpreted?

we have a car on hire purchase that i need for work will we have to hand this back? or will they allow us to keep?

also with regards to my payments has anyone experienced a similar situation or got any advice as to what to do, i really dont want to let them down but we need to face head on.

also do i stop making payments and try saving for a reserve fund? but if IVA declinded where would this leave us and would it go against getting the IVA agreed?

also we have never missed a payment as this really is a last resport we have tried everything possible and we keep going round in circles and debt esculating because of it.

sorry for all the questions just trying to get my head around this

thanks again

FoggyBrain_2

Hello and welcome. Addressing your points as raised:

how long from contracting an IP does it take to get the IVA set up? Mine took 5 weeks -- usual is around 8

Tesco finance is our largest creditor has anyone had experience of how they see IVA are they likely to agree, second largest is Barclays (unless my parents are taken into the equation) Tescos voted Yes on ours, Barclaycard voted no

my husband wages vary dramatically depending on whether he hits bonus (which is not guarenteed) how do they decide what our income is? also once IVA agreed and we get extra income if he gets bonus does this go straight to IVA or what is the procedure? Income should be based on guarenteed income. Bonuses are usually dealt with by disregarding the first amount equivalent to 10% normal salary then the balance split 50/50 (mine, however is a straight 50/50 split). This will be outlined in your draft proposal.

also i have read that IVA are not joint does this mean we both have to set up IVA or have I misinterpreted? IVA's are not joint, each will be individual. However, if you have a joint debt included in both, they can be made "interlocking" (basically the same as joint: one monthly payment to cover both).

we have a car on hire purchase that i need for work will we have to hand this back? or will they allow us to keep? They will allow a modest car (most family cars .. not an Aston Martin). The HP payment will form part of your expenditure. When the HP ends, you will be expected to pay what you were paying in HP into the IVA from then on.

also with regards to my payments has anyone experienced a similar situation or got any advice as to what to do, i really dont want to let them down but we need to face head on. I was up to date ( but struggling) up until I decided to "go IVA", from that day on I didn't make any more payments, but saved up what I could for a contingency fund. Obviously I didn't run up any more credit either!

also do i stop making payments and try saving for a reserve fund? but if IVA declinded where would this leave us and would it go against getting the IVA agreed? See above ..... Makes little difference to getting the IVA agreed. If IVA declined (which is rare these days, once your IP thinks it's a runner) then you could negotiate a DMP to give you breathing space to work out your next move.

Have a look on https://www.iva.com for some other reputable IVA companies ( with reviews). It's a good idea to speak to a couple, to compare advice and get a "feel" for a company you will be working with over the next five years or so.

Best of Luck :0)

georgie14

thanks for your response really helpful i am already feeling better that i have posted. i hope you dont mind but i have added a few more points below, it seems one question gets answered and then i have loads more to ask - sorry just trying to get my head round it all.

thanks again


Hello and welcome. Addressing your points as raised:

how long from contracting an IP does it take to get the IVA set up? Mine took 5 weeks -- usual is around 8 (not as long as i thought but still dont fancy the thought of worrying for 8 weeks about whether would be accepted)

Tesco finance is our largest creditor has anyone had experience of how they see IVA are they likely to agree, second largest is Barclays (unless my parents are taken into the equation) Tescos voted Yes on ours, Barclaycard voted no (tesco is £24,000 we owe and barclays £7000 (loan & overdraft), barclaycard 13000(is this the same as barclays - might be silly question) egg credit card £7000, next £700, marks & spencer £2400 - sorry for listing all creditors but now worried as to who says no and what happens if they do?

my husband wages vary dramatically depending on whether he hits bonus (which is not guarenteed) how do they decide what our income is? also once IVA agreed and we get extra income if he gets bonus does this go straight to IVA or what is the procedure? Income should be based on guarenteed income. Bonuses are usually dealt with by disregarding the first amount equivalent to 10% normal salary then the balance split 50/50 (mine, however is a straight 50/50 split). This will be outlined in your draft proposal. Thanks for clarifying but the bonus he receives is quite high (its been the only thing that been getting us by for so long) for example he just got £3000 bonus but as i said this is not set in stone and is performance related as it can be such a high amount would they still look at it that you get 50% they take 50% just seems silly that they dont take the full amount

also i have read that IVA are not joint does this mean we both have to set up IVA or have I misinterpreted? IVA's are not joint, each will be individual. However, if you have a joint debt included in both, they can be made "interlocking" (basically the same as joint: one monthly payment to cover both). thanks

we have a car on hire purchase that i need for work will we have to hand this back? or will they allow us to keep? They will allow a modest car (most family cars .. not an Aston Martin). The HP payment will form part of your expenditure. When the HP ends, you will be expected to pay what you were paying in HP into the IVA from then on. No its a mini not an aston martin and currently on 4 year HP (were a year into it) and costs 250 a month but i work 30 miles away from home so need a car

also with regards to my payments has anyone experienced a similar situation or got any advice as to what to do, i really dont want to let them down but we need to face head on. I was up to date ( but struggling) up until I decided to "go IVA", from that day on I didn't make any more payments, but saved up what I could for a contingency fund. Obviously I didn't run up any more credit either! so from contacting an IP am i better to not pay any non essential payments - where would i put the money? and will they ask for this back?

also do i stop making payments and try saving for a reserve fund? but if IVA declinded where would this leave us and would it go against getting the IVA agreed? See above ..... Makes little difference to getting the IVA agreed. If IVA declined (which is rare these days, once your IP thinks it's a runner) then you could negotiate a DMP to give you breathing space to work out your next move.

FoggyBrain_2

no worries ... many more questions will arise .....

From what I gather some creditors vote no on some and yes on others, so no way of telling which way they will go. Your chosen IP will have a better idea nearer the time. Bonuses are dealt with on the 50/50 basis, windfalls (inheritances, lottery wins and the like) are taken in total --- sometimes you get to keep the first £500. By letting you keep half of earned money they are encouraging you to work harder (they benefit as well as you).

Keep paying debts, as much as you can, until you have decided an IVA is the way you want to go. Once you stop making payments the phone will start to ring! Just give them your IP's details and don't get into any discussions. The money can be paid into your new bank account ....... you will need to open an account with a bank that you don't owe anything to (or in the same group). Co-Op are the favourite here ... ask for a Cashminder account (I have two -- one for everyday payments etc and one for savings --- my halves of bonuses and overtime). You won't be allowed an overdraft facility. HSBC and First Direct don't like IVA's and will clkose the account when they discover you are in one, so avoid them.

They won't ask for the money back (unless it's thousands!) and most IP's encourage you to get together an emergency fund --- it helps the IVA carry on when cars need repairs and / or boilers blow up.

Be sensible when working out your expenses, as they will be the basis of what you will be living on for the next five years --- so don't cut your cloth too much! There is a good guide here (pdf file halfway down the page) Living Expenses Guide:

http://www.wilmott-turner.co.uk/consumer-debt-solutions/living-expenses-guide.htm

miss_prim

The link appears to be unavailable at prersent.

FoggyBrain_2

hmmmm --- looks like they are changing from Beat my Debt to Wilmott-Turner. I notice there are trwo links there now (one BMD, t'other WM). Hopefully a work in progress and it will be working soon.