IVA for JOINT debts

needtogetoutofdebt

Hi. I'm new to this forum but hoping to get some advice about my debt.

We have debt of £50,000+ and have been looking into what an IVA involves. I do think the debt is high enough (unfortunately) to need to do an IVA to avoid eventually having to go bankcrupt instead

Anyway, I'm not sure how it works when both me and my husband have things in our names. I.e. we call it a joint debt but some things are in my husband's name and some in mine (roughly half each).

My husband has been out of work for 2 years and I am self employed so income isn't always the same. Due to my work (I'm a childminder), I need my home and my 8 seater car (nothing flash) but I'm aware my husband probably will have to get rid of his car?

Anyway, I'll be phoning one of the suggested helpline numbers next week but before I phone, I thought I'd ask a couple of questions on here:

1) May be a silly question but just checking that you can have joint IVAs? Or would we need to apply for 2, one for each of our names? (one loan is in joint names)

2) When they work out the amount you pay each month, what do they usually look at? Are you allow to put in your budget (i.e. with obvious like mortgage, food shopping, bills etc) money for problems that will arise (we've had bad luck with things like boiler breaking, gas pipes leaking etc) and are you allowed to have a certain amount to set aside for things like road tax, MOT, children's bday/christmas presents (not a lot, just hate the thought of them having nothing at all)?

3) If we work this out on our current situation, what happens if I loose/gain customers or my husband gets a job? Do we just contact them and they reassess?

4) Any tips/advice to get us started? I've been putting on spreadsheets all the figures I think we'll need but that's all I've done so far.

That's all I can think of for now. Any help would be much appreciated. We've been so depressed about lack of job, getting in more and more debt each month as need the credit card to survives, we've sort of had our heads in the clouds, mostly because my husband would never talk about it. I believe that it's make or break time for us and I really don't want us to loose our home (no equity in it, that's interest only too! )

Thanks in advance.

FoggyBrain_2

1) May be a silly question but just checking that you can have joint IVAs? Or would we need to apply for 2, one for each of our names? (one loan is in joint names). You will need to apply for two, interlocking IVA's, which will be serviced from one payment.

2) When they work out the amount you pay each month, what do they usually look at? Are you allow to put in your budget (i.e. with obvious like mortgage, food shopping, bills etc) money for problems that will arise (we've had bad luck with things like boiler breaking, gas pipes leaking etc) and are you allowed to have a certain amount to set aside for things like road tax, MOT, children's bday/christmas presents (not a lot, just hate the thought of them having nothing at all)? You will have allowances built in for most expenditure, but not presents, these will have to be funded from savings you make in the hiousekeeping, etc. There is a useful guide on the beatmydebt website, on the living expenses page

3) If we work this out on our current situation, what happens if I loose/gain customers or my husband gets a job? Do we just contact them and they reassess? Basically, yes, although they can only lower the repayment by up to 15% without going back for approval from the creditors. It's not as simple as that and wil be catered for in your proposal.

4) Any tips/advice to get us started? I've been putting on spreadsheets all the figures I think we'll need but that's all I've done so far. Pop over to www.iva.com and have a word with a couple of the companies there, as well as, possibly, Payplan and / or CCCS. Different companies have different ways of doing things and you need to find someone you feel you can work with for around 5 years. The initial advice is free and without obligation. Also make sure the comapnies you chat to are experienced in dealing with the self employed.

immoral_angeluk

Joint debts are anything where you are both account holders (not just additional cardholders), or where another person is guarantor. If this is the case you are both jointly liable for the whole debt.

IVAs cannot be joint, but you can have 2 sole IVAs running alongside each other if with the same IVA company. Disposable income will be assessed on whatever's left after your reasonable household expenditure (including food, clothing etc) but some expenses won't always be allowed, for example expensive sky packages etc.

IVAs do not affect assests unless specifically accounted for in the IVA, say if you were planning on selling the car to pay creditors.

An IVA will only be viable if you have a stable income, large amount of disposable income and are needing to protect assets/employment or where bankruptcy would have more serious implications on you. If not, you may be better off looking at bankruptcy.

needtogetoutofdebt

Thanks to both of you, I will definitely look at the recommended sites for more info. Thanks for clarifying the 'joint' situation, I had a feeling that would be the case.

I've just looked at my spreadsheet again and realised I made a mistake. The debts are less than I thought but having said that, the loan balances are what they are NOW i.e. has a note saying that this isn't the amount we'd pay. So when looking at figures, do you know whether we're looking at what the original contract said the 'total cost of loan' would be or the current 'settlement' figure?

My spreadsheet is showing the following:

My name only - £15,937.59
Husband's name only - £8050.46
Joint names - £17,970.56
Total - £41,958.61

As I said, there are 2 loans which both have only included the 'balance' as per statement so would obviously be higher (i.e. loan in just my name......£10,000 loan, if kept and paid for rest of period, would have cost me £16,415.28, today's 'balance' is £9946.62, @ today's date the settlement figure is £10,218.91.

The debts will get higher as we are currently having to use cards to survive each month (spending only on essentials) so it means the min payments get higher and so on.

One more question......

- Is it an option for only me to have an IVA (if accepted of course) that would include the joint loan as my name is included? Reason being is it sounds like hubby wouldn't be able to get one as not earning an income and sounds like HE must have a steady income?

Sorry if I'm not being 100% clear on everything, I'm quite emotional about the whole thing at the moment so just trying my best to understand my options!

FoggyBrain_2

If only one of you goes for an IVA the other will become responsible for all of the joint debt, aven though it's included in the IVA! This will mean that the creditors will hassle him for the payment. When we went for interlocking IVA's both were based upon the household income and expenditure, So, I would imagine, as long as your income is sufficient to service an IVA it will be OK ... but an expert can advise you more on that. A reputable firm will discuss all options, as well as IVA.

immoral_angeluk

Have you had a look at bankruptcy?

jamesd

needtogetoutofdebt wrote: »

there are 2 loans which both have only included the 'balance' as per statement so would obviously be higher (i.e. loan in just my name......£10,000 loan, if kept and paid for rest of period, would have cost me £16,415.28, today's 'balance' is £9946.62, @ today's date the settlement figure is £10,218.91.

£9946.62 is the amount currently owed.

The higher £10,218.91 figure can include interest for a while in addition to the amount owed, perhaps a couple of months worth counting from 28 days after the date the settlement figure was provided. The precise rules are set out in the early settlement regulations.

needtogetoutofdebt

Thanks again. Bit worried then as I'm guessing my husband won't get any luck with an IVA as he doesn't have a steady income due to lack of a job for so long. So then me having an IVA isn't as great if the largest debt is in both our names?! Hmm, lots to think about but thanks for pointing that out.

I haven't looked into bankruptcy yet but going to investigate that too. We were just trying to keep our home/car as without them, I wouldn't have my business any more which would mean a loss of a fair amount of income (especially as I'm the only one bringing money in).

Just a thought, my husband is a registered assistant and was working with me. He had to stop due to having 2 operations near each other but if he started back working with me, do you think they'd take the self employed income into consideration for both of us? I'm guessing not as the business is in my name, maybe if I paid him a small salary that would work? I don't know, need to get advice elsewhere about the business side of things. I do know another husband and wife childminding team so will speak to them.

Thanks for the confirmation about the loan figures

Lots more to think about, thanks everyone for being so helpful. Was a bit worried about being new on here but you've been kind so thanks.

needtogetoutofdebt

Might not have to go down the IVA route 'finger crossed'! Spoke to CCCS who said that we could probably go for a debt management plan and I have an appointment to go through it all the week after next. I really hope this works out as a real option but if not, I'll be back if I need any more advice.

Thanks again.

debtdalek

I have virtually no income and the higher proportion of the debts. We have two IVA's which is mostly based on my husbands income.
We did a spreadsheet too and had to argue our case for certain values, but really didn't want to go down the DMP route as we'd be paying the debt plus the interest for ever more and the creditors could still be chasing us, or worse still, selling us on to a third party.
The IVA was the best for us, but as someone else just answered, it's early days and I'll know more when we've had our first review.
I wouldn't want to waste more time waiting for an appointment as the interest is piling up all the time and if you're already living off your cards, then it can't be good.
However, everyone's circumstances are very different and just because something is right for one person doesn't necessarily make it right for another - so get some advice and I wish you luck.