IVA Advice

Therealwonderer

Hi Everyone

Looking for some advice from people that have been through this process

I'm considering getting an Iva . I have been paying all my debt and it's up to date, but by the time that's all gone I barely have enough for food and fuel before there's nothing left. I owe around 40k, half on a loan that has 6 years to run and the rest on credit cards / overdraft

My questions really are
1) what is it like living with an Iva? Do they allow you money left over each month to try and save any or socialise / do stuff with the kids ?

2) I get an annual bonus, would I have to give all of that to the ip / people I owe money too? I've seen the 50/50 rule but not clear on how that works

How realistic are the amounts you're given to live on? I have looked at the guidelines and I spend more on fuel etc than the max limits ?

What criteria do they use when working out how much to let you keep, for example just about to move to a different rented accommodation that is slightly more expensive ( around £100 a month ) as we need the extra space. My other half doesn't work currently as she's a stay at home mum, would they view that dimly ?

I have 2 children, a step daughter and a baby on the way and I feel this needs to be resolved now, I want to be able to provide for them all as best as possible. I earn a good wage and have just been a bit silly with money over the years and got myself in this mess. fell for the cheap credit binge as many others have done, and I want to turn it around.

Any advice, encouragement or otherwise would be greatly received !

Thanks!

beckstar1975

I am just coming out the other end of a DMP and whilst I am glad we did it as it means we kept our house, I would really recommend you exhaust other options first, as it has been a hard slog. If you can make the payments until the baby is a year and your wife get a job you should be able to pay down your debts quicker and have more money. It is a long time to be accountable for your spending and be able to do little that costs.

We were also luck to have a relative with a house abroad we could use fir holidays else it really would have been really really tough.

To be fair, though, it doesn't sound like you are actually at the stage of needing to do an IVA , I think maybe first you need to do an SOA to see if there's wriggle room elsewhere

Therealwonderer

Hiya
Thanks for getting back to me

I have been through everything and cut back where at all possible. From what I understand a dro works a bit differently anyway. I don't really see any other option to clear the debts and live at the moment

beckstar1975

Yes a DROP is, DMP is where you pay back all the debt owed, my sig shows how much it was, IVA instead is for fixed time and you pay back as much as you can within that time.

I would recommend doing the Debt Remedy on National Debtline to help work out the best option for you given your circumstances, you have to take professional advice to do an IVA, strongly recommend a free to use charity like Step Change or Payplan

Therealwonderer

Yep going to contact stepchange, just wanted to see what others had experienced :-) thanks!!

beckstar1975

Also, to be fair, whatever option you chose is not suddenly going to free up loads of cash, you want to look st what is going to both help pay back what you owe and improve things in the medium to long term, the short term will be tough whatever option you go for

sourcrates

Hi,

It's only natural to have lots of questions, all I can tell you is once your IVA is agreed, and as long as you keep paying, things usually proceed pretty smoothly.

Normally it's you who decide what your budget is, make sure you have figures in all categories, for example, if you don't smoke, book money for tobacco, if you don't drink, book money for alcohol, in other words be creative with your budget, so it doesn't cause problems later down the line.

As for bonuses, you will have to give up a portion of it, but don't be afraid to discuss this with your IP before hand.

What I can tell you is once approved, life just goes on as normal, you have no creditor contact, except the odd statement they are still obliged to send you, but that's it, you have a yearly check up on your finances to see if you can up your payments or not, but really that's it, life continues as normal.

In Year five you will have to (try) to remortgage (if homeowner) if it's not possible, a further year of payments is the norm.

Therealwonderer

Can I ask - I don't own a house, so can't remortgage ( obviously ! ) does that normally mean it's a 6 year term then ?

sourcrates

Therealwonderer wrote: »

Can I ask - I don't own a house, so can't remortgage ( obviously ! ) does that normally mean it's a 6 year term then ?

It all depends on your debt, and your repayments, it's something you would have to disvusss with the IP.

fatbelly

Therealwonderer wrote: »

Can I ask - I don't own a house, so can't remortgage ( obviously ! ) does that normally mean it's a 6 year term then ?

It'd be 5 years and it opens the question - why are you not considering bankruptcy?

Therealwonderer

Indiscoubfed bankruptcy as I need things like a bigger car for the kids that I would probably have to sell as part of it ( it's not worth lots/excessive but more than the £1000 you are allowed ) plus I have no issue paying back as much as possible, at the end of the day I spent it , just need to make it more affordable.