Failing iva and outcome

madmaisy2017

I have been in an iva for 2 yrs this Sept with a debt of £23,000. I have missed several payments and i am about to miss another one due to financial problems. I know this time they will fail me as they keep threatening to do so and i cant make up the payments. In the 2 yrs no money has gone towards my creditors as they send me yearly statements. My question is shall i just let it fail and contact my creditors personally to make monthly payments. I know i will be paying longer than 7 yrs but i will feel more in control of my finances etc. Question 2, should i contact them prior to my iva failing.

sourcrates

Hi,

It would help a lot to know a little more about your personal circumstances, are you a homeowner for example, or do you rent, is there a specific reason why you keep missing payments, or have you just not budgeted correctly (lots of people fail to budget correctly when entering an IVA), you state "financial problems" as a reason for non payment, but you shouldnt have any, as the IVA was supposed to take care of that, have you taken on extra debt ?

I would not tell your creditors anything just yet, the failure process takes some time to complete, everything has to be wound up, and any disbursments have to be made to creditors, there is a possibility your IP or your creditors could start bankrupcy proceeding against you, although that`s quite rare, you just need to be aware of it.


When/if, you are sure the arrangement is going to fail, then get in touch with them and work out some kind of payment plan.

Oliver2809006

Had this experience.

If your IVA does fail your creditors will definitely be on your back within a few months demanding their monies back.

Some might make a deal on a final settlement some may not but I'd be surprised if they let it go.

As you say your struggling pay the IVA payments so why would dealing back with your creditors be any different especially when in all likelihood the payments will be higher again

If you've no assets and rent then considering bankruptcy could be the way forward.