helping an in-law with advice

andy.m_2

Hi guys,
One of our in-laws has dropped the debt bombshell over the weekend, massively.
Please bear with me as I dont have all the facts but I will give as much info as possible, I am basically after a nugget or two of advice for her.

She is a benefits Mum of 1 and so has no chance of paying it all back I suspect. Approx £50k unsercured debt.
She works 16 hours/week on the High street, gets all the bens/housing etc
I also believe that She has been on and failed to maintain a DMP that started about 6 years ago....

She has been advised by the CAB or CCCS not sure which to go either:
a) Bankrupt or
b) IVA

She believes that one of the options will cost 750 and the other nothing, and that one lasts for 3 years and the other 5.

If it were me I would have googled it and researched it a lot more, but, well, She is a bit dippy bless her.
She is behind on rent, despite being on housing benefit in a housing association property???!
Under her previous agreement (all at £1/week intially) they have all approached her to up the payments and she has so is now struggling again...

But she is family so I want to help.
I have printed off some SOA forms.
I have printed off Martin's guide to IVA and also Fermi's guide to BR and the bis booklet for her.

SHE HAS NOT HAD A LIGHTBULB MOMENT in my opinion.
At the moment when pressed she just responds, " I know I know, well I just need to put it behind me and move on with it now", hardly on the same scale as her issues as I see it but who knows, maybe I do her a dis-service.

I just need a simple precis/schedule comparison for IVA/BR if there is one please so I can set her down with some facts and kind of make her realise the magnitude of what is about to happen.
Sort of tough love/shock tactics that may just make her smell the coffee.

I guess one of my biggest concerns is that She is putting our 1 year old Nephew into a life of debt and poverty and that doesnt seem fair to me, not fair at all.

I will try to get her over onto the DFW/BR boards however as She has been a "head in the sand!" type of girl I'm not sure She will.

fermi

Can't see an IVA being workable on that income, and honestly no real point.

So I would say either:

- Continue with token or just no payments. Creditors will or won't take court action. Most likely won't. But even if they did they can't get blood out of a stone etc. But there is long terms continued hassle that way.
- Go bankrupt. Would clear debts and be discharged after 1 year. Credit record would be trashed for 6, but it's probably rock bottom as it is. If she earned enough then she might have to pay into an Income Payment Agreement for 3 years, but on part time work, HB etc I can't imagine she would have spare income to do that, so likely one would never be set up.

andy.m_2

Thank you for the response Fermi, I have suggested that while the CAB are great, she needs to go to the CCCS as per your signature

fermi

She probably needs to talk to CCCS, National Debtline and perhaps somewhere else.

In other words get a cross-section of advice.

Not only will that help get a balanced range of views on the best option, but if they all come back saying similar things it might drive it home and give greater confidence that is the way to go.