Bankruptcy / IVA and pregnancy...

GD2_2

Looks like BR is possibly favourite, but the choice is yours. IVA is usually a better bet than DMP as regards timescale if nothing else, and of course it allows you to retain control of assets whereas BR means potentially surrendering any assets, but the obvious issue here is that you are pregnant and most IP's would prefer any proposal to be done post birth rather than pre, as it affects benefits received, you need more money to live on as you have an extra mouth to feed etc, and of course may affect your income from your business as well.

Maybe a reduction and then review after the birth will buy you some time to make a final decision? Should creditors look to secure in the meantime you still have the right to as a court to dismiss any such application on a number of grounds.

Good luck anyways.

bumpy1

Thanks GD2

That was actually more helpful than you realise. Ive just come back from a meeting with CAB and they pretty much said the same. BR and IVA should be the very last resort and in the meantime, to work with my DMP and get them to negotiate on our behalf to bring the monthly payments down. The creditors should look on this more favourably than us simply turning around and saying that we cant afford to pay them any longer - fullstop.

Also, as we are then in negotiations with them, they should be less likely to chase us for CCJs. We can always pay them more again after having the baby if the business looks as though its going to be financially viable. And as you rightfully said, if they do decide to try and secure the debt then we can always ask the court to dismiss it on several grounds.

Sadly, I'm entitled to best part of nothing when it comes to benefits as my husband earns too much (I wish this was considered on an affordability scale as it would be much fairer all round, but hey!)

Thanks again GD2 - really useful feedback.

bumpy1

Also, forgot to mention that CAB said that there would be no harm sending the letters to the creditors in the meantime asking them for the original credit agreements, as for all intensive purposes all we are doing is requesting information, what we then later decide to do with that information is up to us. (Plus any PPI compensation would come in incxredibly useful if we did decide to go down that route!)

GD2_2

No probs.

When baby is born, do your sums again. If a DMP is going to take more than, say, 8 years then IVA is an option at that point. Last thing you want to do is to pay these things back forever.

bumpy1

Very true.

Another question (sorry!) Its just occured to me that the unsecured debt that is associated with the mortgage isnt being paid back pro rata through payplan, and if we are going to offer all of our creditors £1 each for example, then surely this should be included too.

After all, 105% and 110% mortgages arent available anymore and therefore they must acknowledge that it was their risk offering it to us as unsecured anyhow, whereas they would have had the power to secure it at the time.

I'm guessing that the only way that the house would be at risk by doing this is if they come after us for a CCJ and they end up putting a charge against the house - which again we'd have many ground on which to contest it. (If this is correct then I wish we had known all this when we got the CCJ 4 years ago for 7K by one of the creditors, as we'd have contested that on the grounds that it would be deemed as favourable over the other creditors. However, I think I'm right in thinking (as Ive only just read up on it) that we can return to court and contest this original CCJ too?

GD2_2

Assuming it is N/Rock, then technically you are right that they should be treated the same as your other debts. P/P are probably just playing it safe though as N/R will usually do one of 2 things, either look for a charge very sharpish or possibly pay the unsecured first before the mortgage, which then leads to mortgage arrears. Very unfair practice, but there you have it.

It will be covered by IVA though, should you take that route eventually. Not too bad that in reality, as although they will try and insist on 6 years rather than 5, if they don't hold more than 25% of the voting rights it isn't a given that they will hold sway on that. Even if it is 6, that is still a good result for you, as that debt may have 20 odd years to go still if it wasn't covered by IVA.

As for going back to court and challenging the charge I am not sure that it is worth the effort as I personally (only my opinion) wouldn't imagine the court would feel you had grounds to challenge.

Anondebtadvisor

There are many instances of flipping going on with CCCS and payplan and understand there is also legal action pending against Payplan for this practice. Maybe just one of the reasons they will not be part of the debt management protocol?

GD2_2

Should this be last answer be on the other thread?

bumpy1

Interesting, thanks GD2

In which case I'd be best to leave the loan associated with the mortgage alone for now and just try and reduce everything else via payplan, would you say?

I spoke with Payplan earlier today re offering all of our debtors a pound each and so we are going to arrange a time and date to go through everything in detail. I'll post a thread regarding the outcome incase its helpful for anyone out there.

I also spoke with a company called DAU earlier today as I was keen to explore PPI options. They are a sister company to Gladstone Brookes. GB dont deal with PPI for people on a DMP, but DAU do. Went through affordability and budgets etc and one benefit they seem to have over payplan is that they work as a one stop shop for people like me; dealing with both PPI and DMPs themselves. They were automatically able to reduce our monthly payments although our current terms of 15 years with payplan would be extended to 22 years with DAU, so surely if you extend the terms alone, the monthly repayments come down! Any PPI compensation gets written off the debt, which is indeed helpful...however, as with most PPI companies, should they be successful in their claims their fee is not taken off what would be awarded, as there is no cheque from the creditors at the end of it, so they do charge you a fee which they then incorporate into your DMP (in my eyes, this is yet another debt, which will push the monthly payment up, which doesnt sit comfortably with me.

Does anyone have any experience with these guys, and should I see it for what it is, and try and get the reduced payments through payplan?

DAU say we have a strong case, as at the time both husband and I were in stable full time jobs, but of course they are going to say that! They look into loans, credit cards, store cards and catalogues. They seek 8% compensation. They also look to recoup default charges as for anyone who has ever paid late fees etc, shoud they have been charged anything over £12, (I do remember HSBC charging double this at one point) then they will claim this back also.

I'm not sold on it, but can see the benefits of having everything under one roof.

I'm inclined to go down the route of going around PPI claims myself.

Any feedback would be great, thanks.

GD2_2

Avoid like the plague would be my initial thought.

Sounds like a debt reduction scheme to me, not even a DMP. These schemes are built on sand and companies that operate them have a habit of going bust, like Apex DCM or Debt DR. I see, to a point, the benefit of adding any fees for a successful claim to a DMP. If you win £2k off your debt, and they charge 25% then your nett reduction is £1,500 so you still win overall.

If you do it yourself, which you should, then you might, just might, have another string to your bow. Your debts are, not to put too fine a point on it, significant in terms of the amount owing. If there is any money to come back from the mis-sale of PPI, it follows that any recompense may also be significant. Whilst it is likely that any payout will be offset so that you don't see it in cash, it doesn't always work like that. You should also give a lot of thought to previous debts that you have paid off. With your level of debt (sorry to harp on about that) the likelihood is that there are a few of those to look at as well. Should you manage to get any payments made to you, depending on the amount you have, you could look immediately at a single premium IVA. One payment of your lump sum as currently you cannot sustain monthly payments.

That's my take on it anyway.