IVA / Bankruptcy query

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

Comments

  • MalMonroe
    MalMonroe Posts: 5,783 Forumite
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    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. 
    Please note - taken from the Forum Rules and amended for my own personal use (with thanks) : It is up to you to investigate, check, double-check and check yet again before you make any decisions or take any action based on any information you glean from any of my posts. Although I do carry out careful research before posting and never intend to mislead or supply out-of-date or incorrect information, please do not rely 100% on what you are reading. Verify everything in order to protect yourself as you are responsible for any action you consequently take.
  • sourcrates
    sourcrates Posts: 28,854 Ambassador
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    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 ?
    I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
  • 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
    CIS Posts: 12,260 Forumite
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    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.

    I no longer work in Council Tax Recovery but instead work as a specialist Council Tax paralegal assisting landlords and Council Tax payers with council tax disputes and valuation tribunals. My views are my own reading of the law and you should always check with the local authority in question.
  • Do you own your house or are you renting? Who is your IVA through?
  • sourcrates
    sourcrates Posts: 28,854 Ambassador
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    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’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
  • 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
    sourcrates Posts: 28,854 Ambassador
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    edited 1 November 2021 at 7:37PM
    tom_154 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.
    I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
  • 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
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