New current account before doing IVA, will it be ok?

zAndy1

Hi all,
I popped into Halifax today to enquire about current accounts as I need to open a new account before I start an IVA and before my credit rating is so bad I won't be able to! About 20 mins later the account was open, debit card and cheque book provided (well to follow in the post). I asked for no overdraft but at the end of the process it turns out the account as a £5 overdraft on it. Does this mean I won't be able to use this account while I've got an IVA? I would seem a bit petty if that's the case after all I have every intention of remaining in credit on the account and after all a £5 O/D is no use to anyone anyway!

Cheers,
Andy.

ukboy

Hi you are able to operate a normal bank account without an overdraft although as you say a fiver is no use to anybody is it, as for the debit card i am unsure wether you can use that or not but it does not say anything about you not being able to hope this helps

zAndy1

Well I've spoken to debt free direct and FCL (payplan) tonight, DFD said I'd have to close it and open another as the account can't have a cheque book, FCL said the account would be fine. DFD also said that with an IVA the equity is assessed at the end of 4 years, FCL said the equity is assessed at the start of the IVA and 75% of that equity would be expected to be released. The difference in advice on what is supposed to be a legal process with hard and fast rules is astonishing to be honest..

doelani

zAndy1 wrote:

Well I've spoken to debt free direct and FCL (payplan) tonight, DFD said I'd have to close it and open another as the account can't have a cheque book, FCL said the account would be fine. DFD also said that with an IVA the equity is assessed at the end of 4 years, FCL said the equity is assessed at the start of the IVA and 75% of that equity would be expected to be released. The difference in advice on what is supposed to be a legal process with hard and fast rules is astonishing to be honest..

As long as you do not have an overdraft the cheque book should not matter, I had to change my bank accounts when I started IVA but had an old Halifax Cardcash account that I have started using again and I sent the first payment to my IP by cheque and was never told I needed to close it.

My IVA took a valuation at start of IVA and I have to pay 75% of the available equity at that date. Although this has not to be paid until year 5. I think it depends on how IP draws up IVA proposal and if the creditors agree to it.

rcosgrove

Hi,

If you didn't tell the Halifax you're filing for an IVA when you applied (I'm guessing you didn't as your application was processed in 20mins), tell them now and see what they say.

The only people who can answer your questions for certain are the Halifax and whoever's arranging your IVA.

- Richard