IVA / Bankruptcy query 31 October 2021 at 4:56PM in Bankruptcy & living with it 9 replies 272 views

tom_154

Hi all

In process of an iva application, but my mind is doing somersaults as it's still a week or so before the creditor meeting. As it's a sunday i can't ring the company who are doing the application so thought i would put a few queries here in the meantime. Any pointers greatly appreciated.

If the iva is declined (it's mainly council tax) do i have to then jump on to a bankrutpcy angle.  My fear is that the council could start prison proceedings and this in particualr is where my mind is going crazy at the minute.  Can the bankruptcy process kick in very quickly to prevent the council going down prison lines ?

I've let the baillff company know i';ve started an iva application, but of course they still say they could visit in the meantime - i presume my stance is that i don't answer the door etc still with them ?

Any help appreciated..

Thanks

MalMonroe

Hi.

Um, I really don't think you will be going to prison quite just yet.

If the creditors haven't even had a meeting yet, why have bailiffs been threatening you?

You probably won't have to jump straight from a refused IVA to bankruptcy. Ask the company who are helping you - I hope it's one of the free debt help agencies such as StepChange (excellent company with great staff). For example, this is what they say about bailiffs -

https://www.stepchange.org/debt-info/debt-collection/bailiff-help-and-advice.aspx

And this is their contact page - https://www.stepchange.org/

What you need to do today, for the sake of your sanity, is take a really deep breath and then allow yourself just half an hour more to think about all of this. That is, have a worry for 30 more minutes - and then that's it.

You need to try to put it out of your mind, distract yourself, read a book watch a TV programme, play some music, have a lovely bubble bath. Anything. Because there is absolutely nothing that you can do today.

Then tomorrow, speak to someone at the company who is helping with your application and ask them all your questions. 

Do try not to worry too much, though. Many of us on this forum have been in a similar situation to yours, and we have survived. You can too. 

sourcrates

I think you may be over reacting a tad here, there is a long process to go through before prison.

Bailiffs won`t be interested in what`s going to happen, only what is happening currently, doors locked, yes.

What amount of debt are we talking about here ?

The usual process for approving an IVA, is as you are aware, a meeting of your creditors, usually its done via the phone on a conference call, not an actual meeting.
75% of your creditors, by volume of debt, must approve it for it to be passed.

If they don`t approve it straight away, they may ask you to realise a larger amount of money per month, if that is possible, or they may make some other stipulation, that you would have to agree too.

But mostly, the decision to approve will be taken.

It will only be refused if you and your creditors are so far apart, that a compromise cannot be reached.

Can I ask why you have chosen an IVA over Bankruptcy ?
Do you have assets to protect ?

tom_154

sourcrates said:

I think you may be over reacting a tad here, there is a long process to go through before prison.

Bailiffs won`t be interested in what`s going to happen, only what is happening currently, doors locked, yes.

What amount of debt are we talking about here ?

Thanks for the kind reply and also to the other poster, very kind of you to get back to me so quick.

The debt in total is around 12k with other bits thrown in but the council element is technically the largest part so it will be them with the lion share . 

I don't have any assets but i think the notion of bankruptcy was something i just didn't want to consider, more out of shame than anything else i think.

Thanks re the bailiff advice too - they didn't give a monkeys when i advised them, but i didn't really expect them to do anything else really.  

CIS

My fear is that the council could start prison proceedings and this in particualr is where my mind is going crazy at the minute

Exceedingly rare for his occur. Only an exceedingly small number of cases get anywhere near even consideration of starting proceedings.

flipflopflo

Do you own your house or are you renting? Who is your IVA through?

sourcrates

IVA for only 12k of debt is not the best choice you could make.

Like wise Bankruptcy a tad extreme also, however its over quicker, and deals directly with the issue.

Did you not consider a debt relief order at all ?

You say you have no assets, so I'm assuming that means you don`t own a property, signing up for what will be a 60 month sentence makes no sense to me at all.

tom_154

sourcrates said:

IVA for only 12k of debt is not the best choice you could make.

Like wise Bankruptcy a tad extreme also, however its over quicker, and deals directly with the issue.

Did you not consider a debt relief order at all ?

You say you have no assets, so I'm assuming that means you don`t own a property, signing up for what will be a 60 month sentence makes no sense to me at all.

I have more than the £75 spare at the end of the month and that appears to be a specific criteria for eligibility so i didnt think i would qualify on those grounds alone.

sourcrates

tom_154 said:

sourcrates said:

IVA for only 12k of debt is not the best choice you could make.

Like wise Bankruptcy a tad extreme also, however its over quicker, and deals directly with the issue.

Did you not consider a debt relief order at all ?

You say you have no assets, so I'm assuming that means you don`t own a property, signing up for what will be a 60 month sentence makes no sense to me at all.

I have more than the £75 spare at the end of the month and that appears to be a specific criteria for eligibility so i didnt think i would qualify on those grounds alone.

How much more ?

Many people do, because they simply don`t budget for all the things they spend money on, do you actually have this amount left at month end ? 

You might need to re-visit your budget, as long as you meet the other criteria, if its £75 or less, your in, over £75 your not.

Remember, you are not checked up on, you do not have to justify it to anyone, you just have to spend what you say you spend, its not difficult to make the figures fit.

I would take a 12 month DRO, over a 60 month IVA, any day of the year.

Think very carefully before you commit yourself to a 60 month rope around your neck, the failure rate for IVA`s is quite high, mainly due to the fact most people do not fully understand how they work, or what they are signing up for.

peterparker12

You need to speak to a debt charity such as Stepchange or CAB. You seem to know dangerously little about your situation. You'll feel empowered after the phone call