My situation, any advice appreciated

Xbigman

zAndy1 wrote:

Another idea. My brother might also be willing to pay off the tesco loan. That would remove a bid chunk of my IVA total and remove the need for my wife to do an IVA at all as the only reason she's doing one is because of the joint tesco debt. Is it legal for us to do this or is it seen as preferential treatment of a creditor? I don't see how there's much anyone can say about it if my brother decides to settle a debt I have to be honest. Or would the problem be that in order to do that he'd have to give me or my wife the money and then if we distributed that money to only one creditor it wouldn't be ok to do that?

If you haven't started the IVA process yet then it is ok to pay off Tesco. You can probably do a 'full and final' settlement on the Tesco loan and get something knocked off if you explain your circumstances. Your brother would write the cheque straight to Tesco. How would you pay your brother back? If he is prepared to wait long term at no interest would you even need to consider IVA or bankruptcy?

Questions worth thinking about.
Regards



X

zAndy1

Would it also depend on none of my other creditors being aware that I owe that much to Tesco? If I send a list of my creditors to each of them and then all of a sudden Tesco aren't in an IVA aren't my other creditors going to wonder why? It certainly seems on the face of it to be an option worth pursuing though. I still think I myself would need to do an IVA (or possibly a DMP) as my debts would still be £50k even with that paid off.

zAndy1

If I decided to go bankrupt and my wife decided to meet her payment obligations and pay the tesco loan and her credit card payments (even if that meant her doing a DMP), that would mean as a household we'd have no surplus income. Would that mean the OR wouldn't be able to get any money from me for paying to my creditors or is it not that straightforward? Would the OR be able to say that my outgoings are 50% of the mortgage + 50% of the household bills + 50% of the utility bills etc in which case it would undoubtedly mean I'd have spare income but my wife would have a large deficit (as I earn approx 2.5 times what she does).
By the way, looks like paying the tesco loan off isn't going to be an option...

Any ideas?

Xbigman

You need to pay off the Tesco's loan before starting the IVA. You could do it afterwards but it gets complicated. Your situation in general has so many variables that I think all those replying to you are guessing at what we think would happen based on our own experience. With that proviso, I think if you set up an IVA with Tesco's on it you would not actually pay Tesco's anything as they would come after your wife (The IVA might pay Tesco's pro rata and they would come after your wife for the shortfall, but I think its the former).
Ask your IVA advisor what happens to this loan and they should know (I think you only discussed joint or dual IVA's with them and not one IVA and one not affected).

Looking at bankruptcy. As for your possible IPA. When you present you SOA to the official reciever you should split all the bills 50/50 with your wife on that SOA. Therefore *you* will have free income with which to pay the IPA. If there is a big difference between your income and your wifes IE you earn more and pay a larger share of the bills, then lay out your SOA that way. IE joint income and expenditure.
The OR is not 100% rulebound and can view your finances either way.
If either method of working out your SOA leaves your wife short of money to pay her debts then thats her problem and not yours or your OR (he is *your* OR and not hers). Just to clarify. Your OR will leave you enough money for you and your family to live on but that does not include your wifes unsecured debts.
Regards



X

Limana68

Hi there,
Just wanted to say that 5 yrs ago me and my hubby were in the same situation as you with 43K of debt through loans and credit cards. We too had 2 good incomes but I got pregnant( accidentally-but happy with it) and because we both worked shifts one of us had to give up work due to childcare reasons.
We decided I should stay with my job as it was more secure, however that did not help our financial situation. We went to CAB, and decided to go for IVA, we were even considering bankruptcy but I could not due to my job.
We went with a company called Chatsworth & Co who are based in Doncaster area I think.
They were brilliant, and in a few mths from originally paying over £1300 in monthly debt payments, we were down to £435. A lot less stress!!
We were only renting at the time so did not have equity etc.
However 3 yrs down the line we got a mortgage and bought our house, and got extra and paid off IVA early.( all the creditors agreed)
We are now debt free!!
I would say that it does restrict you on the IVa, and they do send you a income/expenditure form every yr and will re evaluate your situation. We had to pay an extra £20 for a few yrs as my wages increased.
I never thought I would ever be able to repay my debts so the IVAworked for me.

Whatever you decide good luck with everything
L

black-saturn

Here's my suggestion on basic ways which you could cut down:

Mobiles - £30 - Remember 15 years ago when no one had one? Everyone managed then without one so why can't anyone manage without one now?

Give up the car - saving you £255 per month - or at least cut down on car use.

Shopping - Cut down to £40 per week. It can be done. I spend £40 every 6 weeks on shopping for 3 people.

Gas/elec/water - Go on a water meter and be sparing with the water, don't put the heating on, put a jumper on instead, cook big batches of meals and just defrost them and reheat them when needed.

Kids School dinners - Packed lunches is cheaper

Clothes - Time to make do and mend I'm afraid or shop in charity shops and ebay.

You have to live as if your unemployed and pay all the extra money off the debt. Why is it always the ones who earn the most that get into the most debt? Isn't the extortionate amount you earn enough for you?

I paid off £4,000 in 1 year which doesn't sound like much until I tell you my income is £150 per week and I have 2 children.

donnalove

hi zandy1

the reason dfd do a joint iva is that if you pool your debts as 1 then the dividend to your's and your wife's creditors would be higher than doing to single iva's, therefore more likly to be accepted.
we have just completed our iva with dfd it was a joint iva.
you would still have to pay your secured loans as they would not be able to be put into your iva.
over 5 years if you paid say £500 into the iva pot per month you would pay approx£30,000 but about £9000 would be taken in fee's so you would have £21,000 in the pot of a joint iva compared to about £7,000 if they were single. i really would look at the option of a joint iva(not recomending) it did work for us.

you could also look at the option of you brother paying off the tesco loan, ask him if he will let you pay it back later, that way you could go into an iva on your own and your wife just pay her debts. that way the equity release in the 4th year would just be 75%of your half of the equity.

helen21_2

black-saturn wrote:

I spend £40 every 6 weeks on shopping for 3 people.

Off topic i know but how the hell do you only spend £40 in 6 weeks on shopping? I spend over that a week for me and 2 kids

Mjdowney50

have you tried CAB they can be very helpful these situations. Also if you have a credit union near you pay them a visit

black-saturn

helen21 wrote:

Off topic i know but how the hell do you only spend £40 in 6 weeks on shopping? I spend over that a week for me and 2 kids

Theres a thread all about it in OS money saving called 'How frugal are you?'