IVA or DMP

Danny008

I've recently done my SOA with stepchange and my primary debt solution is an IVA. I did have my heart set on a DMP but it will be 14 years long. The thing that worries me about an IVA is if it fails for some reason I'm back at square one. Also the possible remortgaging/secured loan at the 5th year. Anyone else choose an IVA over a DMP and how did it go?

sourcrates

Hi,

It’s certainly a big decision to make, 14 years far too long, however, don’t rush into an IVA, lots of people fall foul of the equity release clause in year 5, I wasn’t a homeowner, so wasn’t an issue for me, I did an extra year of payments.

Start with the DMP budget well enough to save a good emergency fund, then try and use that fund to settle individual debts as and when you can, see how that goes.

Danny008

I know that's my main worry. Stepchange have said that everyone with an IVA through them that has applied to re mortgage has been rejected so just done another year. My thoughts on the 14 year DMP were that it was too long but I was hoping to get it down by saving and offering F&F settlements.

Grebbie212

Hi, I make my last 2 payments on a 6 year IVA, which they (Creditfix) extended by a year due to equity in my house. Although it has been a very difficult 7 years of having no credit cards or Bank Loans we will finally be Debit free after having a debt of 40-45k. Personally, I would go down the IVA route cut your losses and get paid off and down quicker than a DMP, but that’s my personal opinion. I think it greatly depends on how much debt u have and whether u own your house etc. Our IVA was an exceptional 6 years +1 year, your setup maybe different. Maybe book an appointment with an adviser and see what they come out with and then do a Pro vs Con exercise and if it turns out that it’s right for and feels right. Then don’t waste anytime get signed up and get it going. The quicker I start the quicker it’s done.

Hope this helps

Danny008

Hi thanks for your reply. We have 48k of debt and we own our own house. We have an nram unsecured loan so we may have to go for a 6 year iva too, with the possibility of 7 if we can't remortgage. I'm going to have a chat with an IP over the next few days and see what I think after that. Did you have any problems throughout the iva?

[Deleted User]

Any chance you could cut spending to the bone and/or boost income, thereby shortening the time period for a DMP?

Danny008

Possibly. Would it be best to save and offer F&F or pay extra into DMP?

[Deleted User]

I'd leave that question, until you've figured out if you can shorten your DMP enough to make one viable.

I suggest posting an SOA (link below), so the members can advise on how to free up some money, so you can do a reasonably short DMP.

http://www.stoozing.com/calculator/soa.php

z1a

See if you can remortgage enough to do an instant IVA for an immediate settlement, I did and creditors accepted about 30% of debt. I did it through Grant Thornton.

jon1965

Here is a question or two for you

The debts that you have, how many were secured and how many were taken out prior to April 2007

I also have similar sort of debt level but am just a little way off them being statute barred and with the new pre action protocols I am hopeful that many will go SB thus ending many years of debt

Funkym

Hi I was in a IVA for 6 years and it wasn't easy but I got by, as long as you send in your expenditures etc you will complete. The worst part was the final few months when they asked if we had equity in the house. Anyway it only took me a few months to build my credit rating up and a year later I got a mortgage! Good luck if you do decide x