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Mental health and IVA

Hi everyone,

After realising I was unable to meet payments to pay off all my creditors I have taken action and entered an IVA because I know deep down it was the right thing to do and if I buried my head in the sand it would only get worse. I am trying to take full responsibility for the situation I am in, and pay monthly over a 5 year term, but I am writing this post because ever since signing off on the document I've been feeling awful about myself. I feel angry, upset, hopeless, and even guilty.

I'm not here to be coddled, I know the debts are my responsibility. Yes they were taken out for essential reasons amid the current cost of living crisis, but nevertheless, it was my choice to do it which I fully own. However, I feel a lot of anger and resentment towards myself and I almost feel like I've failed both myself and those around me. I hate the fact I've put myself in this position and it feels very isolating, I feel like I'm alone even though it's clear since finding this forum other people are in the same boat.

I have been privileged enough not to enter a DMP, IVA or any other agreement in the past, so perhaps I'm adjusting but I feel really awful and ashamed and I wish I hadn't had to do this, but I really am trying my best to build my finances back up after a disastrous couple of years following a relationship breakdown, moving to a new home, bereavement, and other big life changes. The debts just increased unfortunately which is why I'm here now.

Does anyone have any advice on how to manage these feelings? My new partner is very much aware of my IVA, I've been transparent and he's supportive of that but I would rather not tell friends or family due to a fear of stigma or judgment. I'm normally quite a happy, optimistic person so these intense low feelings are quite unfamiliar and unlike me, but I'd rather not wallow and try and be as proactive as I can to look at things objectively and get myself on track.


Comments

  • ToxtethO'Grady
    ToxtethO'Grady Posts: 344 Forumite
    Seventh Anniversary 100 Posts Name Dropper
    edited 13 July 2022 pm31 5:35PM
    The first thing to tell yourself is....YOU are not the only person who is having to do this. Give yourself a break.
    If you were there would be no insolvency practitioners, there would be no debt advisers, debt charities or debt websites. Creditors would not have teams devoted to collecting debt there would be no debt collection agencies. IVA numbers have ranged from around 6,300 to 7,800 per month over the past year up until May 2022 - govt statistics.
    Things happen to put us in debt and you should view this as an opportunity to futureproof your finances for those one-off or yearly budgeting speed bumps that come around.
    For example new glasses, usual eye tests are 2 yearly and you can budget that in, so new pair are £300 so 300/24= £12.50 per month in your budget to put aside.
    Your life experiences are not the ones that you can just shrug off. They were/are big experiences to get through mentally, emoitonally and financially so anothe reason to give yourself a break.


  • sourcrates
    sourcrates Posts: 30,660 Ambassador
    Part of the Furniture 10,000 Posts I've been Money Tipped! Name Dropper
    Are you a homeowner ?

    How much debt did you have ?

    You have to look at this as just another hurdle to overcome, things happen in life, we make bad decisions, mulling it over won`t help you, many, many people are in the same boat as you are, so don`t ever think you are alone in this, there are millions like you.
    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
  • Are you a homeowner ?

    How much debt did you have ?

    You have to look at this as just another hurdle to overcome, things happen in life, we make bad decisions, mulling it over won`t help you, many, many people are in the same boat as you are, so don`t ever think you are alone in this, there are millions like you.

    No I'm not a homeowner, I'm renting currently due to my situation but thankfully I've had no issue covering rent or bills it's just my creditors that have become a problem.

    My debt is currently ~£8,000 which I appreciate may be small to some but due to my circumstances I can't afford to pay this off without assistance, I'm not on a huge salary and the majority of it does go on rent, bills and living so this felt like my only option. I've really given this some thought so it's not one I've taken lightly.

    Thank you for saying that too, I appreciate it. This seems like a very supportive forum so I'm happy to be here.
  • The first thing to tell yourself is....YOU are not the only person who is having to do this. Give yourself a break.
    If you were there would be no insolvency practitioners, there would be no debt advisers, debt charities or debt websites. Creditors would not have teams devoted to collecting debt there would be no debt collection agencies. IVA numbers have ranged from around 6,300 to 7,800 per month over the past year up until May 2022 - govt statistics.
    Things happen to put us in debt and you should view this as an opportunity to futureproof your finances for those one-off or yearly budgeting speed bumps that come around.
    For example new glasses, usual eye tests are 2 yearly and you can budget that in, so new pair are £300 so 300/24= £12.50 per month in your budget to put aside.
    Your life experiences are not the ones that you can just shrug off. They were/are big experiences to get through mentally, emoitonally and financially so anothe reason to give yourself a break.

    There's the Debt and Mental Health guide available on this website, Stepchange website about debt and stress, National Debtline


    Thank you for your response. You're right, these places exist for a reason and I know it's better to swallow my pride and get help instead of trying to ignore the problem because it would only get worse and worse. I've reached out now I've realised I physically cannot pay this off without support which I guess is the first step.

    I'm definitely trying to see this as a learning curve and now the IVA has freed up some disposable income for me thanks to the reduced payments, I am slowly building up a savings account because something is better than nothing. I know it's a slog and I need to start from ground zero unfortunately but I'm trying to remind myself it will be over after 6 years (including the year it stays on the register) and then I will be able to start over.
  • sourcrates
    sourcrates Posts: 30,660 Ambassador
    Part of the Furniture 10,000 Posts I've been Money Tipped! Name Dropper
    I really don`t want to rain on your parade, but its quite possible you may have made a wrong move here.

    Hopefully things will work out for you, but essentially IVA`s are for homeowners with assets (their house) to protect, who have very large amounts of debt (in the tens of thousands and higher) and who because of there status, can`t go bankrupt.

    Your £8000 debt, could have been better dealt with via a debt management plan or even a debt relief order, It appears to me you were quite poorly advised.

    Now having said that, its not the end of the world, there is no reason, as long as your income keeps coming in, why you cannot complete this, its just a very long time for such a small debt, and you will be paying the standard IVA fee`s as well, your payments will tend to rise each year, and in year 5 you will most likely have another year of payments added, as you do not have a property to re-mortgage, so your arrangement will be  6 years, not 5.

    The chances are you will repay all of what you owe, plus the fee`s, and some on top.

    It`s only those whose debts are quite large, and disposable income quite low, that get any of the debt written off, as your debt is quite small, you will certainly overpay here.
    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 really don`t want to rain on your parade, but its quite possible you may have made a wrong move here.

    Hopefully things will work out for you, but essentially IVA`s are for homeowners with assets (their house) to protect, who have very large amounts of debt (in the tens of thousands and higher) and who because of there status, can`t go bankrupt.

    Your £8000 debt, could have been better dealt with via a debt management plan or even a debt relief order, It appears to me you were quite poorly advised.

    Now having said that, its not the end of the world, there is no reason, as long as your income keeps coming in, why you cannot complete this, its just a very long time for such a small debt, and you will be paying the standard IVA fee`s as well, your payments will tend to rise each year, and in year 5 you will most likely have another year of payments added, as you do not have a property to re-mortgage, so your arrangement will be  6 years, not 5.

    The chances are you will repay all of what you owe, plus the fee`s, and some on top.

    It`s only those whose debts are quite large, and disposable income quite low, that get any of the debt written off, as your debt is quite small, you will certainly overpay here.

    Thanks for your concern. As I said I have thought about this and let's face it none of the options are particularly pleasant and I certainly didn't want to choose bankruptcy over something as small as £8k. I was previously in a Debt Management Plan when I had less creditors which was switched to the IVA as I now have multiple creditors including high-interest payday loans, multiple overdrafts, maxed out credit cards so I've got myself into a right mess with interest rates all over the place, and this way interest is frozen and I feel like I'm able to pay the monthly instalments until this is sorted as I'm in a pretty comfortable job and able to do so.

    I wanted to feel like I'm actually contributing something towards my debts which is why I went down the IVA route and I'm well aware of all the risks attached and the fact it's a long process but it's just something I need to deal with now and get over it honestly. Not to sound snippy or blunt but it is what it is, I've agreed to this and I just need to find a way to deal with it mentally and budget accordingly, which I have spent a lot of time doing over the past few days.

    Entering the IVA has given me a lot more disposable income now I've run the numbers and I've been told I could pay this off quicker if I received money like inheritance, bonus etc down the line (let's face it I don't know where I'll be in 5 years) so I need to see what happens while also prioritising other aspects of my life. I know there's other options out there but I'm not here for that, I need to come to terms with what I've agreed with and that's the important thing to me.

    Thanks again for the genuine concern it does mean a lot but I'm doing what I can and trying to fix my life, my savings and my credit score over time which won't happen with a wave of a wand, I need to be patient.
  • sourcrates
    sourcrates Posts: 30,660 Ambassador
    Part of the Furniture 10,000 Posts I've been Money Tipped! Name Dropper
    Hey, as long as it works for you, that`s all that matters in the long run.

    Good luck with it.
    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
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