Failing IVA and swapping to Bankruptcy

Mrsejp

Hi, 
I'm totally new here. Really hoping someone can help me. 

I started an IVA in December 2017. Unfortunately, last year I ended up on ssp then lost my job due to the loss of my twins and pnd. I was given a payment break of 9 months in the hope that my situation would change both mentally and financially. In December of last year, it decided to become a self employed cleaner. Then covid hit and I lost my clients! Obviously, like many others, things have been incredibly tight throughout the pandemic and unfortunately, although I found myself employment in late August, getting back on track with finances is hard work.

I've now received an official breach notice from my IP and after some extensive research, I'm taking the plunge in to bankruptcy. 

I have 25-26k of debt. Mostly occurred while with my ex partner (sole debt not joint)
I have 3 children and a partner. We live with his parents and obviously don't have a rental agreement but do pay 'board'. I don't own anything, not even a car. Our finances are kept separately, i have very little income and the vast majority of it goes on the children's needs, food shop and towards a council tax that occurred after my IVA. Would anyone please tell me if an IPC would be likely in my case? What sort of things do they take in to allowance etc? 

sourcrates

Hi,
Very sorry for your loss.
Don’t rush into anything yet, failure of an IVA can take a very long time, up to a year to wind things up, and you cannot go bankrupt until your released from the IVA.

You only get an IPA (Income payment arrangement) if you have more than £20 disposable income, so when the time comes, make sure you budget correctly, the allowances are more generous for bankruptcy I believe, the OR will tell you if they are too high.

WillGoodfellow

If your IVA has failed, it is possible that your insolvency practitioner will bankrupt you which can be beneficial as you won't have to pay the £680 fee. It is also possible that you now owe more than you originally did before the IVA as the IVA provider will have added fees.

Wait until the IVA is officially ended and you will then know exactly how much you owe and can make a decision to apply for bankruptcy or not.

bvizion

sourcrates said:

you cannot go bankrupt until your released from the IVA.

Is that true? I started IVA January 2020 and after 5 months I infromed them that I wanted it to fail and will apply for BR isntead. 6 moths after, IVA has not failed and I still keep geting reminders from IVA to make a payment. Last week I submited the BR form and got approved the folloing day. 

fatbelly

bvizion said:

sourcrates said:

you cannot go bankrupt until your released from the IVA.

Is that true? I started IVA January 2020 and after 5 months I infromed them that I wanted it to fail and will apply for BR isntead. 6 moths after, IVA has not failed and I still keep geting reminders from IVA to make a payment. Last week I submited the BR form and got approved the folloing day. 

Yes, you can only have one form of insolvency at a time. The IVA must show as terminated onthe register before you can be declared bankrupt

sourcrates

bvizion said:

sourcrates said:

you cannot go bankrupt until your released from the IVA.

Is that true? I started IVA January 2020 and after 5 months I infromed them that I wanted it to fail and will apply for BR isntead. 6 moths after, IVA has not failed and I still keep geting reminders from IVA to make a payment. Last week I submited the BR form and got approved the folloing day. 

And have you checked the insolvency register to see what is recorded there ?

bvizion

sourcrates said:

bvizion said:

sourcrates said:

you cannot go bankrupt until your released from the IVA.

Is that true? I started IVA January 2020 and after 5 months I infromed them that I wanted it to fail and will apply for BR isntead. 6 moths after, IVA has not failed and I still keep geting reminders from IVA to make a payment. Last week I submited the BR form and got approved the folloing day. 

And have you checked the insolvency register to see what is recorded there ?

I have. And the register does have both, IVA and BR. I am a bit concerned now, if I have done something I should have not, and waited to the IVA to fail. On the BR form there was a question about any other type of insolvency I have had and I have stated there, including the starting date of the IVA. 
I would have thought the BR wouldn't have been approved, if that was the case. Also, I have read on other boards that you don't have to wait for IVA to fail if you wanted to declear yourself BR. 

sourcrates

bvizion said:

sourcrates said:

bvizion said:

sourcrates said:

you cannot go bankrupt until your released from the IVA.

Is that true? I started IVA January 2020 and after 5 months I infromed them that I wanted it to fail and will apply for BR isntead. 6 moths after, IVA has not failed and I still keep geting reminders from IVA to make a payment. Last week I submited the BR form and got approved the folloing day. 

And have you checked the insolvency register to see what is recorded there ?

I have. And the register does have both, IVA and BR. I am a bit concerned now, if I have done something I should have not, and waited to the IVA to fail. On the BR form there was a question about any other type of insolvency I have had and I have stated there, including the starting date of the IVA. 
I would have thought the BR wouldn't have been approved, if that was the case. Also, I have read on other boards that you don't have to wait for IVA to fail if you wanted to declear yourself BR. 

You may be OK, this is from bankrupcy expert -

How to stop your IVA

An IVA is a legally binding agreement. However you can stop it and go Bankrupt at any time. The process is actually very simple. You just need to let the Arrangement fail.

To do this you simply stop making your monthly payments. You also need to inform your Insolvency Practitioner (IP) of your decision. They will normally ask you to confirm your instruction in writing (either by e-mail or letter).

Once you have stopped paying you can go bankrupt at any time. There is actually no need to wait for your IP to formally terminate your IVA. They will normally do this within 3-6 months but you can go bankrupt in the mean time if you wish.

bvizion

sourcrates said:

bvizion said:

sourcrates said:

bvizion said:

sourcrates said:

you cannot go bankrupt until your released from the IVA.

Is that true? I started IVA January 2020 and after 5 months I infromed them that I wanted it to fail and will apply for BR isntead. 6 moths after, IVA has not failed and I still keep geting reminders from IVA to make a payment. Last week I submited the BR form and got approved the folloing day. 

And have you checked the insolvency register to see what is recorded there ?

I have. And the register does have both, IVA and BR. I am a bit concerned now, if I have done something I should have not, and waited to the IVA to fail. On the BR form there was a question about any other type of insolvency I have had and I have stated there, including the starting date of the IVA. 
I would have thought the BR wouldn't have been approved, if that was the case. Also, I have read on other boards that you don't have to wait for IVA to fail if you wanted to declear yourself BR. 

You may be OK, this is from bankrupcy expert -

How to stop your IVA

An IVA is a legally binding agreement. However you can stop it and go Bankrupt at any time. The process is actually very simple. You just need to let the Arrangement fail.

To do this you simply stop making your monthly payments. You also need to inform your Insolvency Practitioner (IP) of your decision. They will normally ask you to confirm your instruction in writing (either by e-mail or letter).

Once you have stopped paying you can go bankrupt at any time. There is actually no need to wait for your IP to formally terminate your IVA. They will normally do this within 3-6 months but you can go bankrupt in the mean time if you wish.

Ah, great. Actually the answer to this is on the last line. "There is actually no need to wait for your IP to formally terminate your IVA".They will normally do this within 3-6 months but you can go bankrupt in the mean time if you wish" I have formally asked the IP to terminate the IVA since June and they have asked me to send writing request, which I have. Also have stoped the paiment at the same time to save for BR fee. 
I do apologise for hijacking the thread, but hopefully this info can help someone else aswell.