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Thinking about an IVA but want opinions/advice

Hi, I hope I can get your honest opinions and advice here, as I am really not coping well at all with my debt.

I've been to the CAB with my debt situation and they have referred me to a free (no money up front) IVA specialist.

I'm really not sure what to do, to me this is a massive step and at the age of 25 I need to make a decision soon and to obviously sort my creditors out and not have the worry as such anymore.

I would like to explain my situation and would then really appreciate some honest advice/opinions as to what the best thing to do is.

I am 25, currently living in a studio flat with my two small dogs (very cramped!) and work very close by. My boyfriend lived here for a couple of months but now works about 60 miles away and on very good money (his first proper pay will be at the end of this month), so stays at his parents to be closer to work for now. I say for now, as our 'plan' is that when the rental agreement runs out on this place near the end of September, we want to have moved into a rented 1 or 2 bed house, close to where my boyfriend works and his family.

We are in around 27k worth of debt and have been seriously struggling to even get through the month and this is without paying any creditors anything, we haven't been for about 6/7 months now and they are obviously on my case. The debt is all in my name but we share the 'burden'. Now, I keep putting off getting an IVA, as if we include both mine and my boyfriends income, it looks as if we can 'afford' a massive chunk each month to be able to pay into the IVA but we don't want all that hard-earned new wages from my boyfriend to basically all go to this IVA, as we need to pay back family and friends and be able to live in this house we are looking to move to which will be a bit more in rent and bills. I fully understand that we need to pay back this debt but I don't want us to be skimping and scrapping again like we have been doing for about a year now. (My boyfiend lost his job, hence how we racked up so much debt and yes, admitedly over spending sometimes).

Is there any alternative to an IVA or another way I could go about sorting this out? I know about debt management plans but they aren't going to be set for a long period of time. I don't mean to sound dodgey at all but was thinking of saying that I'm single (i.e. no boyfriend to be able to contribute to this debt) and do an IVA that way but is that really wrong?

Apologies for the full blown essay but I just want an outsiders opinion to this :(

Many thanks for any help in advance!


  • To_be_Free
    To_be_Free Posts: 123 Forumite
    First Anniversary Combo Breaker First Post
    I have an IVA in my name, as all the debts were in my name and not my wife's the only thing they took into consideration was that she was paying here share of the household living expenses etc.
    Free at last
  • FoggyBrain_2
    FoggyBrain_2 Posts: 1,121 Forumite
    As above, if the debt is yours, it will be your income that will be taken into account. If your boyfriend earns considerably more than you, when living together, they will assume he pays a proportionate share of the household expenses, which would allow you to pay more as disposable income.

    When getting a house together, it will be best to get it in BF's name, so you aren't credit checked ( as you will fail!). What do you intend to do, job wise, if you both move in together nearer BF's work? I imagine you will not be travelling 60 miles back to your present job. This will impact on the viability of an IVA for you.

    Have you considered bankruptcy? You will have an initial payments order, but if your income drops or disappears, this will be reduced or stopped accordingly ( unlike an IVA... BR will not "fail" ).
  • LTP123
    LTP123 Posts: 136 Forumite
    First Anniversary Combo Breaker
    My husband and I have been in debt for years. We were petrified of BR so went with an iva. We struggled to pay it even with us both on a good wage. We stuck to budget but had problems with the direct debit going out on time and it wasn't worth the hassle as we didn't feel any relief from doing it. Instead of paying creditors we were struggling to pay an IP.

    We have decided to declare ourselves BR asap, we have felt enough guilt and had enough sleepless nights. We want everything to be finished once and for all. IVA'S CAN work for some but if you are hoping for a move and fresh start, with an iva you are likely to need to wait six years. Only my opinion.
  • FoggyBrain_2
    FoggyBrain_2 Posts: 1,121 Forumite
    HI LPT123. It sounds as if the income and expenditure on your IVA wasn't worked out correctly. Problems with the DD cannot be laid at the door of the IVA and, if not sorted with the bank, you could have the same problems with your Payments Order if and when you go BR.

    The disposable income, if calculated correctly (and it is up to YOU to agree this), in IVA will be similar to that in BR. So, from the date of BR you will be paying a similar amount each month for up to three years.

    Your credit record will be shot for 6 years from the date of acceptance of the IVA .... the same appl,ies for 6 years from the date of BR

    Unless you have a DI of less than a few quid, BR does not finish everything, once and for all, overnight.
  • LTP123
    LTP123 Posts: 136 Forumite
    First Anniversary Combo Breaker
    Hi foggybrain you are right, it was the fault of the bank that the dd didn't go out correctly. We have no disposable income so, for now, IPA won't be an issue. It took a long time for us to get our heads round BR and still struggling but you need to be sure of your income for the next 6 years with an IVA. The op sounds like they would like to move quite soon, maybe they won't have a job to start right away when they move?
  • JimmyFive

    I was in a similar dilemma last year. I chose to go down the debt management plan route. All my interest and charges on my cards, loan an overdrafts was frozen. IVA writes off some of the debt but its a big deal when you are looking for credit in the future. I used a finance broker called Gopher Money gophermoney.co.uk. There are other companies who will offer you debt management plans but my experiences with this company are all good. Good luck!
  • debt_doctor
    debt_doctor Posts: 4,595 Forumite
    First Post First Anniversary Combo Breaker
    Am I right in thinking you have no assets?

    This is a generalisation, but in BR you pay your surplus income (on a flexible basis) for 3 years. In an IVA you pay your surplus income for 5-6 years. Also if an IVA fails then you may be made or have to go BR.
    Worst case scenario, pay for 4 years or so in to an IVA, then it fails and BR results - then pay for 3 years in BR!
    Why did the CAB 'recommend' an IVA?

    Debt Doctor, Debt caseworker, Citizens' Advice Bureau .
    Impartial debt advice services: Citizens Advice Bureau Find your local CAB *** National Debtline - Tel: 0808 808 4000*** BSC No. 100 ***
  • safetygirl
    safetygirl Posts: 46 Forumite
    sorry im new to this can you explain what the acronyms stand for please!
  • FoggyBrain_2
    FoggyBrain_2 Posts: 1,121 Forumite
    Hi and welcome Safetygirl: Basically here: IVA is Individual Voluntary Arrangement. IP is an Insolvency Practitioner. BF is Boyfriend, BR is Bankruptcy. DI is disposable income and DD is Direct Debit.

    Apologies --- we all start to "talk" in shorthand after a while !
  • lil_ldy
    Thank you all for your opionions and experiences.

    Apologies for the late reply.

    In response to some of your queries:
    I have no assets.
    I will be getting another job closer to where we will be living - I won't be travelling 60 miles a day.

    I have thought about BR but it's so difficult to get my head around and I'm afraid that it will effect my partner a lot in anything he wants to do and what about, for instance, our car insurance premium - will this go up and if we have to claim on home contents insurance or something, will this be declined?

    Will the car we have on HP be taken away and the debt put into the BR?

    I may well considor going BR but my main concern is how it will effect my partner living with me - what he can and can't get or do and his wages. Obviously, he will pay is way with the bills but don't want HIS disposible income affected or even looked at...

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