New IVA

Depth_Charge

nannymc wrote: »

yes they say its definitely an IVA but have explained that i will have to try to release equity in the final year, however, they also understand that I have already tried to do this to pay the debts off in full but have been unable to do so.

This is when it gets scary, because you get mixed stories some saying it doesnt seem right and others saying that they have been in a similar situation. I just cannot wait until it is agreed and in writing, then at least I will be sure as I get differing opinions whichever website I go to

Hi

Are you saying that you have £17500 of debt and £67500 equity in your home and they have advised an IVA and you are already paying them £101 per month?

They are also saying that will have to try to release the equity in the final year?

nannymc

yes thats exactly what i am saying

nannymc

ok now I am questioning everything again, panic setting in

UpToMyNeckInIt

I too tried releasing equity by taking out a secured loan, to pay my debts, but the banks just are not lending - even to people with reasonable amount of equity. Just one of the other reasons I ended up in an IVA.

Please do not panic - you are doing the right thing in tackling your debt. All you need to do is be sure that an IVA is the best route for you (In my case, I felt it was - despite all the potential downsides).

Don't feel 100% guilty about my creditors though: One of them lent £15k to me at 0%, returned to the normal rate of 11%apr, after the 0% had expired (fair enough), then informed me that they were increasing the interest rate to 32%apr.

Yes, it was in part my fault for overspending (and I feel stupid in hindsight for being suckered into the 0% offers), but the banks don't just apply the old apr - they increase it, and there is nothing you can do.

Factoring in my drop in income last year, and I knew it was a matter of time before I would be defaulting.

Best of luck in sorting your situation out.

nannymc

Thank you so much for replying that makes me feel so much better, I wish you luck in your journey too, I will keep posting on here as to my progress.

GD2_2

I would urge caution.

One of the acid tests of Insolvency is that you are not insolvent if your assets outstrip your liabilities, which they seem to do here. If I were a creditor, my first question would be why don't you sell, pay me back in full and you still have a decent amount of "start again" money available. I see little chance of this being accepted, unless there are factors here that have not been disclosed.

I have just had a look at Immediate's site, and whilst I could not swear for certain, I don't think they have their own in house IP, which would explain why you are paying prior to creditors meeting as they act in these istances as a packager. They make mention of an Interim Order being used as a matter of course, when it is nowadays very rare. Most, or at least a goodly number, of reputable IP firms wil NOT charge ahead of creditors meeting. Of course, should you get rejected, well they have a relationship with you already, which makes the odds of you staying with them for a DMP that much higher. I cannot find them on iva.com either. And I do have to question how you would get to speak to a couple of their clients as this info should be data protected by law? Maybe you know them in person of course, which is fine, but if not then you run the risk that they may be anybody at all, or you may have inadvertently breached DPA.

Seems to me that a DMP looks more appropriate, based on the info given here. Where you go for that is up to you, but I would be very wary of staying where you are.

Depth_Charge

Hi

The last poster makes a whole lot of sense, so much so I nearly pressed the thanks button:)

Im also not too sure that IF have their own IP which would make me wonder if I am honest.

I cant see where an IVA will be accepted based on the information too date, but we might not know the full story as GD2 says

A DMP does look more likely given the sheer amount of equity which would leave you open to CCJs & Charging Orders perhaps. You never know though, in the case of a DMP your creditors might have read the OFT guidelines on debt collection and will happily co-ooperate and accept your offers if they are in line with the Common Financial Statement.

Info on DMPs & IVAs, inc the pros and cons here from the CAB

http://mymoney.nedcab.org.uk/moneyadvice/remedy_4.asp

http://mymoney.nedcab.org.uk/moneyadvice/remedy_6.asp

Also CAB info on action creditors can take - inc CCJs & Charging Orders

http://www.adviceguide.org.uk/england/debt_e/debt_action_your_creditor_can_take_e.htm

Also I believe that there may be a number of debt settlement type schemes still operating where the debtor pays into a pot with the idea being when there are sufficient funds a type of full and final settlement is then offered to one creditor after another.

I have seen a few of these and there can be substantial fees paid before any settlements are offered - they may look at PPI claims and charges while offering small or token payments while building up a pot with your payments (this is where the fees can sometimes come in). Risky these if you ask me and Im sure I have read something about these type of schemes by the OFT:)

Best to get a second opinion if you are not sure or do not have any paperwork that clearly spells things out.

As far as paying up front fees, then its a no brainer for me really, go with one of the charities everytime or even consider self administering in the case of a DMP - but it is fair to say that with an IVA it would not hurt to try 2 or three providers and compare

My take and best wishes

nannymc

hi I have been contacted today by Simple Debt Solutions who are actually putting forward my proposal and they will be dealing with my IVA application from now on.

They are quite confident that an IVA is my best solution on the proviso that I am prepared to release equity in the final year. They are hoping to send my proposal by the end of this week. Fingers crossed please:)

nannymc

sorry what I did not say was that the clients of theirs that I have since spoken to are known to my daughter, they came forward with the information and recommendations via her as they work with her or their partners work with her, so no rules have been broken and no breach of confidentiality, as I am speaking to you guys on here they spoke to me, of their own free will

UpToMyNeckInIt

GD2 wrote: »

I would urge caution.

One of the acid tests of Insolvency is that you are not insolvent if your assets outstrip your liabilities, which they seem to do here. If I were a creditor, my first question would be why don't you sell, pay me back in full and you still have a decent amount of "start again" money available. I see little chance of this being accepted, unless there are factors here that have not been disclosed.

I have just had a look at Immediate's site, and whilst I could not swear for certain, I don't think they have their own in house IP, which would explain why you are paying prior to creditors meeting as they act in these istances as a packager. They make mention of an Interim Order being used as a matter of course, when it is nowadays very rare. Most, or at least a goodly number, of reputable IP firms wil NOT charge ahead of creditors meeting. Of course, should you get rejected, well they have a relationship with you already, which makes the odds of you staying with them for a DMP that much higher. I cannot find them on iva.com either. And I do have to question how you would get to speak to a couple of their clients as this info should be data protected by law? Maybe you know them in person of course, which is fine, but if not then you run the risk that they may be anybody at all, or you may have inadvertently breached DPA.

Seems to me that a DMP looks more appropriate, based on the info given here. Where you go for that is up to you, but I would be very wary of staying where you are.

Hmm, True to a point. What if you cannot release equity?

The OP's main asset is the house. Are you really advising that they sell it, lose £5-6K in fees etc? Bearing in mind this process also takes say 4-6 Months. Then what? Rent? and risk watching the remaining money gradually disappear? (I've seen it happen). Utter madness in my opinion. Property ownership is still a good long-term investment, and if there is any way the OP can keep their house, surely that's the best option?

My 2 properties outstripped by debt by £40k, the second of which nets at £3k p/a rental profit. - it was no barrier to getting an IVA.

Both CCCS & NDL wanted me to sell property no2, AND go on a 10 Year DMP. Had I followed their advice, I would have been out of pocket £25-£40K (dependent on what creditors agreed to freeze interest + lost rental income), vs the IVA - where, not only was I allowed to keep the second property (my pension), but the additional rental income was seen as an advantage (by a private firm). Going the IVA route, I'll be debt-free in 6 Years, with £16-£20K of debt + interest written off.

Understand why I am cynical of the 'charities'? Granted, they work for some, but not others.

Surely if the OP's affordability is calculated at £100 p/m, paying back £17,500 on a DMP will take 15 Years (minimum)!!! vs 6 Years in an IVA, at the end of which £10K is written off. I know which I'd choose if I were in their shoes!!! (And after exhausting ways to affordably consolidate my debt).

Granted, IVA's have their downsides, but unless I am missing something major here, surely an IVA is WITH THE PROPER RESEARCH (into equity release clause especially), worthy of consideration in this instance.

Purely my opinion though.