DMP or IVA what is the best ?

spritzer

This is my first post and I have been reading the forums for weeks now and have eventually got up the courage to contact payplan with regards to our
financial situation and they have called me today, we have debts of £51,000 and with a net income each month joint of £3100.00.

They have made recomendations of a DMP or IVA, I am just not sure which is the right way to go can anyone give me any help as i have read some bad things about IVA and DMP but do not want to go bankrupt as we have a mortgage.

I am self-employed, if i decide to do the IVA what will i have to give as proof of my income, and will it have any impact on my husband if he has to show wage slips?

If we decide to do DMP how long do you get the continual phone calls of your creditors for.

Can anyone help?

RAS

People here cannot make that decision for you, just tell you about thier experienc of the two options.

IVA may allow you to pay less than the full amount, but in the first two years, most of your payments will go in fees to the IVA company.

if the IVA fails, an currently a substantial percentage do fail, then any of your creditors or your OR can bankrupt you.

With the DMP, you pay it all but may be able to negoitiate Full and Final offers as your debt decreases.

if you have equity in your house, you will have to release that in year 3 or 4 of an IVA, whilst you can keep the equity in a DMP.

best thing is to post up an SOA and let people see what your situation is in detail.

Phillipa_3

RAS wrote: »

People here cannot make that decision for you, just tell you about thier experienc of the two options.

IVA may allow you to pay less than the full amount, but in the first two years, most of your payments will go in fees to the IVA company.

if the IVA fails, an currently a substantial percentage do fail, then any of your creditors or your OR can bankrupt you.



.

Hi - I'm in a similar positon to you and recently went through the same fact find operation. There is a great deal of scare mongering on this board re: IVA's but for me (and of course you must choose your own course) that was way better than a DMP.

This position re: fees is just plain nonsense. During the course of an IVA then the ammount you will pay will be the same month on month throughout. The insolvency practitioner will take a fee each month for managing your case but that is paid by the creditor and the management of these things is a requirement by the court.

The point is it is fixed by the court - so the debt can't be sold on, the ammount you pay won't change and you will know where you stand from day one.

spritzer

Thanks for your reply Phillipa, I have heard so much bad stuff about IVA that it is really putting me off, I know that we have incurred the debt but payplan have told me that it will take 11-12 years to pay it back with a DMP and the IVA is for 5 years.

Who have you done your IVA ?

thanks

Phillipa_3

Of course there are loads to choose from but I did mine with a company called Debt Princess (0800 0 77 88 13 or https://www.debtprincess.com). Call them and decide for yourself on the advice.

I was over £40K in debt and lucky in a way that I do have a reasonable income as I work in the city.

There is a great deal of negativity around IVA's on here mainly due to the fact the commercial debt companies do get paid a fee. But when you investigate things even the so called not for profit and charities get fees so its all the same in my view - so I just chose mine on service.

Ultimately I took all the emotion out of it and looked at an IVA as a known quantity from the start - I'll be debt free in 60 months. Go with a DMP and whilst there might be some noble attempt to pay all my money back I'd be retired before I actually did!!!

Good luck and I can tell you at least you'll start getting some good nights sleep! x x

spritzer

Thanks nottolate, just read that, it looks like this company has only just been set up this month, was only thinking of using payplan as most people seem to use them or CCCS, I was quite happy with the girl i spoke to at payplan, they are going to send me out all the info on everything so i will give it a read through before i decide what is best for us. Just wanted to see if anyone else has had the same dilemma.

Newgirl_2

Hi, we are in the middle of a DMP and that is working fine for us.

My understanding is that whichever debt advice company you go with would recommend what options are open to you and take it from there but, from reading posts on here, I am not sure most people get either to choose. For example, I saw one thread where a person would have taken too long to pay off their debts under a DMP so they were directed more towards an IVA.

We looked into IVAs at the beginning and a DMP was best for us with only a 6 year run.

The one thing we do like about our DMP is that any money we can throw at it comes off the debt, we are not paying a middle man.

To answer your original question, we only had calls from one company - they didn't start straight away and would run in stages. Basically, we did as were told by the CCCS and kept repeating we were with them, in a DMP and couldnt pay any more than they were currently receiving. They would then stall calls for 10 days, then start again. Now, just 4 months into our plan, all calls have stopped. We don't panic when we open mail anymore, it is a weight off our minds.

Hope this helps

Newgirl

itsnowtime

Hi,

I have large debts and I too had to look at whether an IVA or a DMP was the right thing for me.

I contacted CCCS and they suggested I do a DMP. I'm in the process of establishing this now and it is a huge weight off my shoulders. IVA did scare me, however I can see when they would be useful - I just didn't feel it was the right option for me.

Whichever option you decide - it needs to be the best one for you, and it will all work out for you. The biggest thing is you're dealing with it. - Well done.

You'll get lots of good advise on here. Good luck and keep us posted with what you decide.