IVA 12k

murphy79

I have a total of 12k unsecured debt..credit cards...store cards etc.....i have been on to debt fixers...they say that they can help me get my interest frozen and pay only £150 a month and they will take £25 a month as a fee.....im confused with the whole thing to be honest....ive read alot of stuff on here and the net and just makes it more confusing....it seems the way forward as it frees up around £250 a month........thanks for any help

dancingfairy

Hmm - this does not sound like an IVA. In an IVa the fees come out of the pot and are nothing to do with you. It is also a form of insolvency - like bankruptcy. This sounds very much like a dmp (debt management plan). They (and anyone else) can not guarantee that interest and charges will be stopped - not least of all IF a dmp is the best option for you someone like CCCS or National Debtline will do it for FREE for you.
I would strongly suggest phoning CCCS or National Debtline or popping in to your local CAB for a free , impartial chat.
df

Foxy-Stoat_3

Dont go with ANYONE who takes a fee from the monthly instalments. You MAY save £250 a month, but if you dont pay the debt off with it, then you will be in the same position a few years down the line.

You need to work out your monthly living expenses, ie, no drink, no drugs, no partying, no flash cars/clothes/holidays, just how much it costs you to live without enjoying yourself basically (dont include your debts).

Take that figure from your nett monthly income, if you only have enough to make the minimum payments on your debts, then it will probably take you 10 years to pay them off, if your on 20-40% interest rates on cards, so an IVA may be the way forward. If you are able to transfer them to 0% interest, then you could take a few years off that. I set up an excel spread sheet and was shocked at the length of time it would take you to pay off a £3,000 card at 30% interest by only paying the minimum each month.

Depending on your current finanical situation, a change of lifestyle can help sort out your problems, but assuming you have acculimated these debts due to spending on stuff you want rather than things you need, then being on an IVA for 5 years AND have no access to credit so learning to live without credit could help you out in the long run.

I wouldnt do an IVA for £12K if say I was earning £20K+ as you could pay your way out by say selling an expensive to run car and demoting yourself, or make other changes like not going out every weekend or not doing other stuff. Pay the higher rate interest cards off first and transfer as much as you can to 0% interest cards, dont take out another loan to pay other debts without working out all the numbers for the next few years AND cancelling the card you just paid off, I made that mistake !!!

An IVA with effect you for a long time after you finish.

murphy79

decided to go with A DMP......the money i "save" i will comfortably plough back at the smaller debts first....then concentrate on the bigger 2.....the 2 smaller ones are on 1000+1400.....so with some cutting and saving i would be able to get those out the way first........hopefully i will be able to get the interest frozen.....fingers crossed.....

JokerDurden

Might be wrong here but it was my understanding IVA's can only be considered for over £15K worth of unsecured debt

murphy79

yes mate...i looked into one and they said an IVA would be best....then when i checked here and the net in general it said that my amount is only really in DMP territory.......hopefully i will get a bit of breathing space when its in place....very claustrophobic situation the old debt game...but when i look here i see people in 50k+ debts...and i breath a sigh of relief to a degree.....as soon as this situation is fixed i will be living by my means only.....i had 2 houses to pay for when the Mrs and i split so its been a bit of a struggle.....will sort it out though....in time...:)

murphy79

Had a bit of a breakthrough.....went to the bank and explained my situation.....they said that considering im already past my "deal" stage of my mortgage,it is a better idea to take out a new mortgage and add the 12k to the mortgage....which is pretty good as now i have a 40k mortgage,so it will go up to just over 52k....so i will be free of the debt and only paying the same if not less a month i would normally pay on my current mortgage...this has been a lesson learned...no more credit for "wants"...only "needs".....thank god for that....and thanks for your feedback everyone....