From F&F Day to Hooray - my journey from IVA to closure & beyond

MrFrugalFever

Hi all,
I just wanted to post a little bit about my personal journey ref: IVA (non-mortgage) at F&F point til now.

So back in May, after much deliberation and research I decided to approach Sprout Loans for an ‘IVA Settlement Loan’. I asked many questions and pontificated for a week or so before I hit the button. At the beginning of May 2021 I proceeded with the application, which, after about 20 minutes on the phone seemed fairly straightforward and painless. Along with a ‘hard credit search’, were several questions about my personal circumstances and my reasoning for wanting to re-enter the financial marketplace early. The main reason for me was income protection, followed very closely by loosening of the shackles.
I had been in the IVA since September 2017, so felt it was a good amount of time to have psychologically altered my outlook on money management.

some interesting points to be aware of if you are choosing Sprout Loans;
- you must have at least 15 IVA payments left
- the loan was at 39.9%APR
- the loan will start 30 days after official eSigning and will last a minimum of 18 months
- you can only be offered a loan based on 85% of the total amount of repayments in your IVA, they WILL NOT offer 100%
- no agreement can formally go ahead without the variation meeting taking place and the creditors agreeing the settlement
- you can make overpayments via telephone only, this can reduce either monthly amount OR term

At the point in which I had alerted my IP I had then been given some times scales for meeting etc. Sprout required the Chairman’s report once the creditors had agreed my settlement.
in my case, the creditors would only agree 100% of remaining payments so, Sprout paid the 85% and I found the other 15%.

My final acceptance of settlement by the IP/Creditors (took 2 meetings), was concluded end of July and all monies transferred by beginning of August.

I made my first Sprout loan payment in August. My IVA payments where suspended from June onwards.

I was advised that the closure process could take up to 6 months, I had some brief discussions with the IP company between August & October asking for updates but it was very vague. I finally received my Completion Certificate & document pack end of October.

since receiving this I have kept a close eye on all 3 CRA’s, including the Insolvency Register. All 3 and the IR have reported the Discharge date with the ‘credit score’ increasing slightly across all 3 CRA’s.

I am yet to see the creditors change their statuses to Settled or Partial Settled etc, I am waiting til end of next month for the next credit report update for this.

in the meantime, I have successfully opened a CC with £250 limit (my choice with the limit) and started to spend & clear in full.

I will report back every so often on any other changes I notice and hopefully it will help to give an idea to those not quite at closure point what sort of time scales and journey to expect.

MrFrugalFever

Update 8th Dec 21.

my credit reports with all 3 CRA’s have started to improve nicely, with offers of multiple credit cards and some high interest personal loans.

the data has finally been updated now with regards to accounts in default now showing £0 and settled.

the IVA public record was updated as discharged on last months CRA update.

It appears that some CRA’s see the default accounts as closed and settled but others as defaulted and ended.

I am now anxiously waiting for the IVA to be wiped from the files and to start a complete fresh!

mrcactus

Hi MrFrugalFever.

I was approached by my IP who offered me a Sprout loan. As I was started earning more before my next I&E review, I expected my payments to go up anyway. Sprout only increased my duration by 3 months and seeing as I already paid into 2 years worth of IVA payments, it was ok for me.

Also, I don't have a mortgage so the IVA was good for me as I had so many creditors to deal with it would of been almost impossible to get each one to agree to a payment plan. 

You mentioned that you had to show the Chairmans Report...I was never asked to provide this? Also, I am three months into paying Sprout Loans and there has been no change on my credit reports, the score goes up by 30 points one month then back down. I'm currently at 100/1000 on one of the reference agencies!

Which is the best reference agency to use? I use ClearScore and Credit Karma

Also, nothing is changed on the Insolvency register either. Could it just be that some take longer than others?

MrFrugalFever

Update (July 2022), 7 months since last.

so I have moved address (twice) since my last update, which has thrown my credit reporting brokers in to a frenzy with them removing and adding details and saying I’m op not on the electoral roll etc

The only CRA I have been in dispute with over electoral roll is Transunion, I’ve had to get an official letter from my local council to send off to them, this was beginning of July (I moved in April) and still haven’t heard back from Transunion. Guess they’ll need chasing up after 28 days.

My credit situation has improved drastically as I now have a second credit card (Cap1) with their highest limit on the Capital one complete card of £1,500 and have been spending a little on both CC’s and paying back in full each month. So I now, as of next month, have both a personal loan and CC showing as 12 successful monthly payments.

My IVA still sits on my files and will not fall off until September 2023 unfortunately but it appears that it’s having less of an impact now.

I am now able to obtain further credit at slightly better rates, some with promotional rates too as well as some medium sized personal loans. I haven’t as I don’t need them.

I have had to raise a number of disputes around the default dates on some old accounts, my Iva officially started on 26/9 and some have the accounts defaulted on 30/10 for example which could mean that they will still show on report even after the Iva has dropped off. I want it all to wipe clean on 26/9 if at all possible.

I have seriously learnt the value of money, been able to save significantly more than normal and have stuck to a rigid budget, making use of better savings rates, cash back offers and the like.

I’ve even managed to set savings goals and stick to them so that I have a fully paid for 7 night cruise next year with no credit involved at all.

Final note, NatWest absolutely WILL NOT change my accounts from Foundation (they defaulted to that after IVA set up), I have requested multiple times to have them back up to the standard ‘Select’ account as to me, I’m fully discharged and back in to the Financial Services market and no longer legally bound by the terms of the IVA. I don’t wish to keep being reminded of it every time I login to my NatWest App! I’ve taken it to the highest complaint level that I can but have been issued with a final letter of a stern NO.

They have said all the whilst I have a marker on my credit file, they will not, despite the fact that I now have access to thousands of £’s worth of credit!

gd55

Good to hear your update, I am in almost exactly the same position - IVA started Sep 2017, now fully paid, and currently have Vanquis and Cap One credit cards helping me build a more positive history.

I have also had issues on default dates. Not really knowing what I was doing back then, some of my debts hadn't actually defaulted when I started the IVA, so some have default dates as late as Feb 2018. I have written to them all on several occasions, some get no response, and one said they have no record of the account 

MrFrugalFever

Thanks for the reply!

I have noticed that the PRA group that had purchased some debt off one or more of my creditors no longer exists on my reports but Arrow Global does, along with the main creditors whom I was a customer of at the time of the IVA.

I have had success in changing dates (had to do it through each CRA) with all bar PayPal, they have put up quite a fight about changing the date.

I have found Vanquish and Cap1 to be easy to manage and deal with. I have had Vanquish since July 2021 and asked for a £250 limit initially, haven’t received an increase yet and the CAP1 since end of Dec 21 and haven’t received increase because I’m at their limit but they have offered me a second credit card with another £1,500 limit.

All in, it’s starting to feel like I can breathe again and less overwhelming than before.

Who is your primary account held with, have they been receptive to upgrading your current account out of the basic account if you’ve tried?

gd55

MrFrugalFever said:

Thanks for the reply!

I have noticed that the PRA group that had purchased some debt off one or more of my creditors no longer exists on my reports but Arrow Global does, along with the main creditors whom I was a customer of at the time of the IVA.

I have had success in changing dates (had to do it through each CRA) with all bar PayPal, they have put up quite a fight about changing the date.

I have found Vanquish and Cap1 to be easy to manage and deal with. I have had Vanquish since July 2021 and asked for a £250 limit initially, haven’t received an increase yet and the CAP1 since end of Dec 21 and haven’t received increase because I’m at their limit but they have offered me a second credit card with another £1,500 limit.

All in, it’s starting to feel like I can breathe again and less overwhelming than before.

Who is your primary account held with, have they been receptive to upgrading your current account out of the basic account if you’ve tried?

Great to hear you're already seeing things come off the report.

I actually got a second Cap One (first being Ocean) a couple of weeks ago, and then as soon as it was set up I merged them both on to the older Ocean account, combining the credit limits. If I get any organic increases on that or Vanquis I'll accept them, but I'm not going out to look for any further credit products now. 

My bank account is Santander, Everyday Current Account, so a "normal" one rather than "basic". I think it's always been that since I opened it just before IVA began.

sourcrates

My only word of warning would be to not take on credit, just for the sake of it.

As you get accepted for higher and higher credit limits, its very easy to fall back into your old ways, I understand your currently being responsible, and that`s good, make sure it stays that way, speaking as one who should have taken his own advice, but didn`t.

MrFrugalFever

Absolutely, I’m actually very nervous about spending money that sits within a ‘want’ category rather than need. So much so that it takes me a good few weeks to ponder the amount and decision, ultimately ending up not going ahead anyway.

I’m on a journey to saving for my first house and give myself strict budgets each month, something which I have learnt to do via the IVA, so every cloud has a silver lining I suppose!

@gd55 interesting that Santander haven’t downgraded your current accounts.

gd55

MrFrugalFever said:

Absolutely, I’m actually very nervous about spending money that sits within a ‘want’ category rather than need. So much so that it takes me a good few weeks to ponder the amount and decision, ultimately ending up not going ahead anyway.

I’m on a journey to saving for my first house and give myself strict budgets each month, something which I have learnt to do via the IVA, so every cloud has a silver lining I suppose!

@gd55 interesting that Santander haven’t downgraded your current accounts.

I'm with you on need versus want and saving for a house!

Here's to our sustainable financial futures!

MrFrugalFever

I thought I would provide another brief update as I am now only 10 months away from having my credit files refreshed and the IVA dropping off.

- I have now got 4 x credit cards and ZERO debt on them that cannot be paid in full to avoid interest (total credit limits now £13,250)

- I have 3 payments left on my Sprout Loan then I am £402.44 per month better off

- I have challenged on multiple occasions an incorrect default date with PayPal on TransUnion report but each challenge has proven unsuccessful - i've even had quite the argument with TransUnion this year, specifically over my Electoral Roll status

- I have avoided any further hard credit searches as of October 2022 to ensure I have 12 months of no hard searches prior to mortgage application

Experian seems to show more closed default accounts than Equifax or TransUnion and it appears some of the creditors whom purchased the debt have disappeared entirely from all 3 CRA's

I know the 'scores' are meaningless but all 3 scores are either in the Poor or Fair/Good category, my eligibility for CC's is still good for sub-prime (Aqua/Marbles/Cap1 etc) and one or two personal loans at circa 20%.

In summary, even before the IVA has dropped off officially, i've been able to ensure I have a decent amount of 'emergency credit' along with a substantial amount of savings and have not been hindered anywhere near as much as I thought I would be.