IVA or Bankruptcy

Battle_weary

Hi All

This is my first time here. My husband had a business which we put into recievership in Feb this year after 6 years trading. There were Directors guarantees and we had a loan and credit cards.

In all we owe £94K. We have about £40K equity in our house having remortgaded to keep the business afloat - cannot remortgage yet as £7k penalty - also who would have us? Luckilly we both have jobs now and earn more that required for the bare essentials in life. 2 children - one due to go to University next year - the other in year 9.

We approached debt free direct who say we can go on an IVA. Is this a good idea? Or would be better off going for bankruptcy. We have been to CAB who said that we were intelligent enough to deal with our own problems and that they were there to assist those who could not understand. They were unable to help us further but would assist if we became too stressed.

We did try to sort things ourselves. Offering a regular monthly repayment until next year. Then remortgage with one off final lump sum payment to each creditor pro-rata. Which our largest individual creditor accepted with some others following. However one small creditor decided to take my husband to court and we now have a ccj. So that plan has failed. Hence the thought of an IVA.

My main concerns are;

We have a car on personal laon via Black Horse. They refused to remove the HPI on it so we could sell it. Although they agree that it is a personal loan and they had no right to HPI it they are now happy for us to surrender the car to them. They will then sell it and come after us for the balance. Whatever that may be. But they will not put anything in writing.

Our daughter is due to go to University. If we go through an IVA she will not get a grant because our income is too high but all of the money will be going into the IVA and I don't suppose for one minute they will allow for our daughters university in our monthly budget!

I am so confused - I feel like throwing in the towel and going bankrupt! All advice welcome.

Richard_S

Hi Battle weary,

Your circumstances are remarkably similar to ours before we were declared bankrupt, and having a property with equity in it and a reasonable joint income mean that bankruptcy will be more far reaching and painful for you than other people with no assets and/or a low income. I don't mean that bankruptcy is easy for anyone; there are all sorts of conflicting emotions surrounding the whole process.

We're not trained professionals and can only ever comment based on our own anecdotal experience and that gained from reading of other people's. To anybody posting for the first time I invariably post the following because that way you can be as sure as possible that whatever couurse of action you ultimately take is based on the best information available to you at the time.

Your first port of call should be to contact one of the Debt Charities; see links below. Their services are free; they have no vested interest to serve; their advisors are professionally trained and the advice they give will be objective and in your best interests only. CCCS operate a system of telephone appointments that are designed to be flexible and don’t require you to attend an office based interview. At the CAB you will need to make an appointment with a specialist Financial Advisor; other advisors may not have the specialist knowledge you’ll need.

http://www.cccs.co.uk/

http://www.nationaldebtline.co.uk/

http://www.citizensadvice.org.uk/index.htm

If you’re advised that bankruptcy is the most suitable solution to your financial problems then we can offer the best support and anecdotal advice that you’ll find anywhere on the Web.

For more specific advice and support, in an environment that is managed by people with first hand experience of bankruptcy, and moderated to ensure that no deliberately inflammatory or abusive posts are made then please visit:

http://bankruptcysupportersclub.co.uk/default.aspx

Just remember, as desperate as you may feel at the moment, we have all experienced what you are going through at the moment and with the right support and advice things will improve. It’s not an easy route to take but it is a route that will put you back in control of your life rather than just reacting to events.

This is a pro forma response but it's an essential starting point.

Any other questions please post again,

Kind regards

Richard

Battle_weary

Hi Richard

Thanks for the information.

We are going back to CAB on Tuesday.

I just feel that my head is going to explode.

If we are made bankrupt I shall lose my new job. I am an accountant and Company Secretary for a small local firm- bad credit rating no job!!!

Richard_S

Battle_weary wrote: »

Hi Richard

Thanks for the information.

We are going back to CAB on Tuesday.

I just feel that my head is going to explode.

If we are made bankrupt I shall lose my new job. I am an accountant and Company Secretary for a small local firm- bad credit rating no job!!!

Hi Battle weary,

I used the CCCS and they were very good, with the CAB you need to make as appontment with a Specialist Financial Advisor; so I understand.

There's nothing anybody can say or do at the moment that will ease the burden you're under but I can guarantee you'll look back and wonder why you worried so much.

You might be surprised at how your employer reacts, especially if it's a small firm; good people are very hard to come by and then there's all the associated cost and hassle of training somebody else for the job.

Please post again when you've met with the CAB; if you decide that bankruptcy is the route you have to take then we can try and make it as painless as possible.

Richard

rog2

Just be a bit weary of any advice given by Debt Free Direct - their primary interest is to make money out of your situation (they are, after all, a private company) and they stand to earn a lot of money from either an IVA or a DMP.

As far as Black Horse is concerned - they are, forgive my language, a bunch of b*st**ds to deal with. They will tell you anything, I know from personal experience, to keep you indebted to them. If the loan was a 'Personal Loan' and not a specific car loan, then the car is NOT on Hire Purchase, so they can not stop you from selling it.

Battle_weary

Hi Guys

Thanks for the support.

As a company Secretary I will lose my position if I am a bankrupt - companies house rules; also as the company accountant I am a signatory and main user of internet banking etc. The bank would refuse to allow me access to the bank account. It would be very difficult for my employer to justify keeping me on if I could not fulfil these roles.

I shall be wary of debt free direct. Hence another visit to CAB. I understand the fees from these iva companies can be very high indeed.

With regard to Black Horse. We have been trying to sell the Audi since February. Then realised HPI and DVLA had been informed by Black Horse that they have legal interest in car. This was apparently removed a few days ago - although I haven't had the funds to check - cost me £40 last time. They have admitted that they should have not HPI the car - standard practice according to them. But against the rules! Data protection, FSA etc

Still the week-end is near. Time to be with my family, at least the skarks cannot take them, althugh I would describe my family as my greatest asset!!

seven2seven

This is just a Good Luck message. It can be real tough getting through a financial mess. If you feel any advice given does not "sit right" with you then ask someone else , it never hurts getting a second opinion. Anyway , enjoy the family because they are your life , not your debts.

Richard_S

Battle_weary wrote: »

Hi Guys

Thanks for the support.

As a company Secretary I will lose my position if I am a bankrupt - companies house rules; also as the company accountant I am a signatory and main user of internet banking etc. The bank would refuse to allow me access to the bank account. It would be very difficult for my employer to justify keeping me on if I could not fulfil these roles.

I shall be wary of debt free direct. Hence another visit to CAB. I understand the fees from these iva companies can be very high indeed.

With regard to Black Horse. We have been trying to sell the Audi since February. Then realised HPI and DVLA had been informed by Black Horse that they have legal interest in car. This was apparently removed a few days ago - although I haven't had the funds to check - cost me £40 last time. They have admitted that they should have not HPI the car - standard practice according to them. But against the rules! Data protection, FSA etc

Still the week-end is near. Time to be with my family, at least the skarks cannot take them, althugh I would describe my family as my greatest asset!!

Hi Battle weary,

You'd only have to resign as company secretary for the period of your undischarged bankruptcy and that could be as little as six months. One of the other directors could take the position with you continuing to do the work until such time as you are discharged.

As for internet banking, I don't think the bank could or would object. I work as a finance officer and I'm an authorised signatory with a bank that was our biggest single creditor; approx £75k. It does seem strange writing cheques and signing them but there's never been a problem.

Good for you and your priorities; family come first, second and third for me.:D

Richard

backontheup

It might be worth asking the OR if you can continue to be a company secretary. Sometimes they make exceptions to the rule

debt_doctor

Hi Battleweary, just chill a little bit so you can give a couple of important answers, how important in the big picture is your house, and bankruptcy will result in you not being an accountant.

Are you after a fresh start at all costs ???

Please post

Best wishes,

DD.

whoopsydaisy

I may be wrong, cars are really NOT my strong point! But I think RAC are offering an "online vehicle check powered by HPI" for £5 at the moment. If you go to their website all the details are on the homepage and it covers if the vehicle has outstanding finance.

Hope it goes well for you!