IVA or DRO questions

lannyloo6398

Hi all,

I'm finally biting the bullet and trying to get my finances sorted after many years of neglect due to Mental Health issues.

I'm speaking with someone tomorrow from a charity about the best way forward. 

My total debts are about £14,000.

The main worry I have is surrounding my car. Its on HP and worth about £6,000 and I've never missed a  payment since taking out the HP just over 12 months ago.

I'm worried that I will have to hand my car back if I take an IVA or DRO out, and I require my car for work as its a 25 mile each way trip to work and back.

I don't even know if an IVA or DRO will be suggested, but I'm trying to figure it all out in advance as it takes me a while to process information due to my Mental Health.

Any advice please? 

sourcrates

Forget IVA, you don`t have enough debt, and they are for homeowners only in practical terms, also you can`t have a DRO if you have a car valued at 6k, 2k is the limit in a DRO.

Opt for debt management instead, no restrictions on your car or anything else.

fatbelly

In a Dro, those HP payments would not be an allowable expense, which may blow your surplus over £75 and disqualify you. If it doesn't, then keeping the finance going would require you to find a third party to take over the payments

https://www.gov.uk/guidance/debt-relief-orders-guidance-for-debt-advisers#hire-purchase-agreements

Probably better to avoid insolvency and just look at a debt management plan. Let us know what they say

lannyloo6398

fatbelly said:

In a Dro, those HP payments would not be an allowable expense, which may blow your surplus over £75 and disqualify you. If it doesn't, then keeping the finance going would require you to find a third party to take over the payments

https://www.gov.uk/guidance/debt-relief-orders-guidance-for-debt-advisers#hire-purchase-agreements

Probably better to avoid insolvency and just look at a debt management plan. Let us know what they say

Thanks for your help. Had a good chat and they said they won't advise for an IVA or DRO to me, even without mentioning my car, so that's a relief.

They are going to work out a repayment plan for my creditors etc.

RAS

Glad you've had advice. If this is going to be a Debt Management Plan, do head over to the main Debt free forum for more advice and support.