Considering an IVA

tiggy748_2

Hi
I have 12k in credit card debt
1500 overdraft
200 payday loan
10000 car finance
2000 tax credit overpayment
350 income tax fine

My mortgage is 75k. I purchased for 106k just under a year ago. I have renovated it and its now possibly worth 130-140k

I earn around 1200 a month.

From what I gather my car loan wouldn't go into the IVA but everything else would?
The credit impact is 6 years from the START of the VIA not the finish?

I'm wondering really how my house and car would be affected. I need my car as I'm a nurse and public transport wouldn't work for my shifts. I guess they would let me keep this as the car is valued around 8k?

I can afford 200 a month repayments, maybe 250.

I have looked at remortgage but my credit file ain't great with a missed payment and a few other bits. I think im.more keen to go down this route if I can but would like more info on an IVA if needed

tiggy748_2

Edit..... I have a zero hours contract a default from 4 years ago and a 2 missed payments. Getting a mortgage would be hard unless it was a very expensive one. I'm also tied into my to current mortgage for 4 years.

However at 200/250 a month over 5 years more or less pays the whole thing off providing they agree to stop interest? Does an IVA stop the debts from continuing to increase?

sourcrates

Hi,

An IVA is a form of insolvency, your debts are frozen, and you have legal protection from your creditors, it’s not like a DMP, this is a regulated agreement.

Please do some research though, stepchange and National Debtline are good sources of information, likewise debt camel, you need to know all the facts, especially the re-mortgage clause in year 5, pertinent to you as a homeowner.


An IVA may not be your best option.

National_Debtline

Hi tiggy748,


From what you have described, an IVA does not appear suitable. You are not insolvent due to the level of equity in your home (somewhere between £55k - 65k), so if you did do an IVA you could end up repaying more than your total debt, and the purpose of an IVA is to try and get some debt written off. Plus your situation is unsettled as you are on a zero hours contract. If you cannot maintain payments into an IVA, there is a risk you will be declared bankrupt. In bankruptcy your assets, such as your home, are at a very high risk of being taken.


I think a DMP would seem more suitable. Although it is not legally binding it would be more flexible with less consequences if you are unable to sustain it. If you could pay £200 - £250 per month into a DMP, and the interest and charges were frozen, you could be debt free in 4 - 5 years (which is shorter than an IVA with no equity release clause). I would suggest that you post a SOA to check this is suitable and then get in touch with a free DMP provider.


Laura
@natdebtline