Advice required as I have run up massive debt

Fandc

Hi -I have just totalled up all my debt and it has come to £95k ouch!
I know that it has grown and grown and grown and now it has got so out of control.. On top of this I have a mortgage of £149k and a house which is worth about £260k

I know it sounds stupid but because I have had the minimum repayments covered by DDebit and don't receive paper statements I did not realise the problem was this huge and it was only when Barclaycard said that I had missed a payment that I realised I was in a crisis now that I have seen my credit file I realise that I have missed a few min payments in the last 2 months. Looking through the statements it seems that it is the interest racking up at a massive amount that is causing the huge increase in amounts and also I didn't realise that the credit limits have been automatically increased to allow for the increase in the interest that is accruing and that Barclaycard have given me a limit of over 50k - my income is £2500 per month after Tax

Does anyone know whether I would be able to get an IVA? And if so whether the equity of my house would be safe - obviously I have tried to get a remortgage but can't get near the amount I require.

Any great ideas would be really appreciated!

Thanks

cheesedoffwithdebt

I am sure you will get loads of responses- but for a starter, you need to go and get professional advice, you will only get opinions on here, so for your own safety's sake its better to look at this "properly". Organisations such as PAyplan, CCCS,National Debtline and Christians Against Poverty will not charge for their services and offer good advice. With that level of debt certainly an IVA or bankruptcy are most likely to be the best solutions- depending on how much income you have and of course your assets. Knowing what I know now ( 4 years after my own "crisis") there isn't an easy way out of this unfortunately. If you go down the IVA route, at the end of the IVA period the equity in your home will be assessed and depending on how much, it may be that you have to remortgage to release some of that equity.
The missing link on the detail you have given is how much you spend each month- there are boards here and someone I am sure will direct which ones, where you can post a statement of affairs- that will show how much free income you have to repay debts, that determines which insolvency route will be best along with your assets (including equity in your home).
as I said I am sure others will post with more specifics-but good luck.

UpToMyNeckInIt

Fandc wrote: »

Hi -I have just totalled up all my debt and it has come to £95k ouch!
I know that it has grown and grown and grown and now it has got so out of control.. On top of this I have a mortgage of £149k and a house which is worth about £260k

I know it sounds stupid but because I have had the minimum repayments covered by DDebit and don't receive paper statements I did not realise the problem was this huge and it was only when Barclaycard said that I had missed a payment that I realised I was in a crisis now that I have seen my credit file I realise that I have missed a few min payments in the last 2 months. Looking through the statements it seems that it is the interest racking up at a massive amount that is causing the huge increase in amounts and also I didn't realise that the credit limits have been automatically increased to allow for the increase in the interest that is accruing and that Barclaycard have given me a limit of over 50k - my income is £2500 per month after Tax

Does anyone know whether I would be able to get an IVA? And if so whether the equity of my house would be safe - obviously I have tried to get a remortgage but can't get near the amount I require.

Any great ideas would be really appreciated!

Thanks

Hi,

No reason why you should not be considered for an IVA. Best advice is: Speak to a few IVA providers (go to iva . com . for some reviews.

You shouls always record your income/expenditure honestly at the application and review stages. To assist you regarding what is deemed 'reasonable' expenditure: All IPs make reference to the CCCS guidelines (If you want to refer to them, google:

'cccs budget guidelines report 2011'

...and there you have it - the full (and I believe, current) guidance document - free to download as a pdf. It covers every form of expenditure, (including items I never thought to budget for) right the way down to guideline allowances for hairdressing, kid's school dinners and pocket money if so required.

Bear in mind that, however unlikely it is currently likely to happen, most IVA's require homeowners to (subject to a property valuation in Month 54 of the IVA), attempt to release equity via remortgage / secured loan up to 85% LTV to increase creditor dividend (subject to the resulting payment being max. 50% of you current IVA payment for affordability reasons).

In the current climate, usually what happens is that you cannot get a remortgage etc, so your IVA payments continue for another 12 Months instead. But what happens in 3-4 years time is anyone's guess.