IVA/bankruptcy/DRO

Everblue

Hello

My husband has decided to start doing something about his debt which is around 25k. We have seperate finances (I have a much smaller amount of debt which is managable but I'm not left with much at the end of the month to support his debt... He pays around £650 a month but then spends again to afford things like the food shop so it never decreases).

After looking into options, stepchange advised a DRO - however my partner has just realised he had not accounted in overtime he does (its forced, he doesn't get a choice) which provides around £150 a month extra income. So that's likely out of the question. 

So the next choice is either an IVA or bankruptcy. Our main concern is that we would eventually like to be able to get a mortgage - we live in his parents home and will need to buy it from them in about 6 years so they can retire. I know this will be hard with either.. But it will be impossible with the way the debt is at the moment (without taking into account the impact on the family and his mental wellbeing). 

Any advice on what is the best option in terms of moving forward? Especially when considering a future mortgage. 

Many thanks 

luvchocolate

Mortgages are considered after 3 years many threads on here if you search. 
It's off your credit file 6 years after BR 

Grumpelstiltskin

Why doesn't he get back in touch with Stepchange and explain the situation and see what they come up with as a different solution?

Everblue

Grumpelstiltskin said:

Why doesn't he get back in touch with Stepchange and explain the situation and see what they come up with as a different solution?

This is his plan - he also has an appointment with a local money advice charity in 2 weeks time. They did lay out the offer of IVA or bankruptcy but he didn't feel that they favoured one or the other for him. Initially they did not think the DRO was an option due to having additional money, a 2nd call confirmed he did not (he left off a bill he forgot) and that's when a DRO was offered. There will be another call just 3 in one day may be excessive! 

ManyWays

In an IVA he will be paying for 5 years (or longer if he needs any payment extensions.) Also a large number of IVAs fail to complete - over a quarter.
In bankruptcy he would will only have to make payments for 3 years at the most, most people pay nothing. And bankruptcy never fails. So you will be able to start saving up for a deposit earlier with bankruptcy than an IVA.
Both an IVA and bankruptcy have the same effect on his credit record. And after 6 years when that disappears mortgage lender will still ask if you have ever been insolvent, which you have to say "Yes" to for an IVA or bankruptcy. But you can get a mortgage after both an IVA and bankruptcy, it just depends how large a deposit you have managed to save.