IVA V's Current DMP

10past6

Hello Jack :hello:

Jacks_xxx wrote: »

In August 2006 we owed £96,700 plus our mortgage and our joint income is about £2600 a month so we looked into all the options- IVA, Bankruptcy, DMP etc, and ended up running our own DMP eventually, So now - less than two years later - our debt is down to about £15k.

Jack, may I confirm with you please if you don't mind, did you owe £96.700 in unsecured debts?

We're in a very similar situation to you, I'n curious how you managed to get this down to £15K in under 2 years :eek:

We were going down the IVA route, but just cannot take the risk of creditors forcing BR should things go pear shaped within the 5 year perod, an increase in mortgage payments for example.

I know you have no worries about CCCS, our IVA was with them, but no matter how much they have tried to reassure me everything should be OK, I cannot bring myself to complete the paperwork, we'll remain on our DMP.

LilacPixie

I personally think IVA's are unsuitable for the majority of debtors.

I know you are keen to have a target date for being free of debt but you are currently paying £117 a month to your DMP, you hope to add another £33 to that but the bare minimum iva payment would be £220. Even adding your new job into the mix it seem like an IVA may be streching you a little.

Add that to the uncertainty about house prices no one really knows what will happen in the next few years. The BR board is littered with stories of failed IVA's and poor advice given.

Jacks_xxx

10past6 wrote: »

Hello Jack :hello:



Jack, may I confirm with you please if you don't mind, did you owe £96.700 in unsecured debts?

We're in a very similar situation to you, I'n curious how you managed to get this down to £15K in under 2 years :eek:

We were going down the IVA route, but just cannot take the risk of creditors forcing BR should things go pear shaped within the 5 year perod, an increase in mortgage payments for example.

I know you have no worries about CCCS, our IVA was with them, but no matter how much they have tried to reassure me everything should be OK, I cannot bring myself to complete the paperwork, we'll remain on our DMP.

Hiya sweetie, :wave:

Yep we owed (How lovely it is to be able to put it in the past tense. :j ) £96,700 in unsecured loans and cards etc, and now it's about £15k. I can't say we've done anythging very remarkable really. We've just worked as a team and kept plugging away at it.

Sometimes I get fed up and @r$ey but mostly we just beaver away getting the job done.

First of all we used the snowball calculator to get a good idea of where we were (Up sh*t creek was the general conclusion) At our current rate of payments and interest we would be paying until 2028.

So I rang all or our creditors and told them CCCS had advised us that bankruptcy was our best option but that I was sure that if they would just freeze the interest we could continue to make our normal payments.

The point being that if we would be paying these debts forever and ever (and ever!) because of the interest then we may as well go bankrupt and be done with it.

BUT if they froze the interest I could see light at the end of the tunnel and we would soldier on making the payments every month like good little debtors.

We got frozen interest of about a year out of most of our creditors which helped enormously.

(Change the interest rate in your snowball to 0% and see how much faster it goes! It's incredible.)

Then we made some pretty major lifestyle changes, and had some good luck.

I jacked in my job to work locally so that we could sell my car and save the money we were spending every month in car tax, car insurance, upkeep, parking and petrol etc

I now work part time so we don't have to pay for childcare either.

Hubby sold his car and bought an old diesel banger which we're trying to covert to veg oil at the moment!)

We dumped our mobile phones cos we don't really *need* them do we?

Thanks to Moneysaving Old Style we cut our food budget from £650+ a month to about £285 - 300 a month.

We eBay, Amazon, Mystery shop, babysit, garden and carboot to earn extra dosh. If we need extra money for something then we do extra work to earn it.

We got the kids on board early on, and we do it all as a family. I love hearing my daughter castigate her mates for "being stupid with money" and my son - bless him - had total faith that although he was being quoted £2000 for a years insurance on his first car that he only needed to budget about half that cos his Mum would find him a deal (I did but it was £1250! :rolleyes: )

And we challenged Every. Single. Outgoing. Penny.

All thatt stuff that we just blindly pay and renew for years and years. Take nothing as read, and weigh up the pros and cons of all of it.. Ask yourself:

Do we need this?

Could we get rid if it for a while and see?

Can we get a better deal?

Can we get it for free (ie RAC membership through Tesco Clubcard points etc.)

Can we get cashback if we switch through Quidco?

Can we structure the payments better to help us?

Also remember honey - Things Change.

Our son got a job and started paying keep.

A rellie who we'd helped out years before suddenly paid us back.

Just as I was weakening and feeling sick of the scrimping and desperate to splurge on some new make up a lovely MSE-er sent me some gorgeous Dior that she'd bought for a special occasion and never really used. (Chev, you are an angel love! :kisses3: :iloveyou: :happyhear :A )

We've been pretty lucky I s'pose. :j

Now apologies if I'm preaching to the choir here honey as I don't know your situation, but whilst staying in the relative safety of your DMP have you thought about earning extra dosh to save up to offer as Full and Final settlements to your creditors? That's one way to speed it up a bit.

I understand your hesitation over the IVA completely. Who the hell knows what's going to happen over the next five years - and I think as IVA's become more prevalent the creditors will think up ever more devious ways to get their pound of flesh out of us once we've signed up.

Perhaps I just feel it's too good to be true? I don't want to dissuade you though. CCCS are generally trustworthy as long as you've given them an accurate picture - so if they're recommending an IVA they must think it's a better option than a DMP for you.

How long is your DMP scheduled to run for?

I'm SO sorry this is so long!

Love Jacks xxx

10past6

Hello Jacks

Thanks for your detailed reply, you've given me something to think about, although I doubt we will be able to clear our debts as quickly as yourself.

We have a very limited budget with very little to spare each month, so trying to save towards a F&F settlement will be difficult.

Our debts are due to be clear around 2025 :eek: that terrifies me.

Re CCCS recommending an IVA, I'm not convinced this is the best solution for us, in that I'm frightened what the next 5 years holds, I'm in my late 40's and things are touchy re my employment at present, i.e some companies are using the credit crunch as an excuse.

As for creditors charging/not charging interest, I'm not sure of those that have frozen, and those that are still charging interest.

I'm reluctant to ring any of them in case I rock the boat, in that we've had no contact from them for sometime, and I'd like to keep it that way.

However, I'll give some thought about contacting them, may I clarify please, who did you contact to have the interest stopped, was it a call centre or a specific department? as I doubt a call centre have the authority to stop the interest.

We have equity in our property, so again, I'm reluctant to suggest we've been recommended BR in case a) I'm found out to be lying or b) it back fires.

What a mess, it's all so not knowing what to do for the best.

Jacks_xxx

10past6 Definitely don't do anything that might jeopardise your DMP honey. And keep CCCS in the loop.

When I told the creditors that we'd been advised that bankruptcy would be our best option, it was easy to have the courage of my convictions cos it was true. It wouldn't have been so easy if I was spinning them a line I don't think. Although I was feeling pretty desperate so maybe.

I was transferred from pillar to post until I got to someone who could authorise anything - and often they said they'd have to ring me back.

If they said that I'd always say "well if I haven't heard from you by 8pm tomorrow we 'll start moving ahead with the bankruptcy then". That wasn't strictly true but I wasn't keen to be left dangling in limbo.

It's a scary time at the moment though, so - frustrating though it may be - perhaps the best course of action is to stay with your DMP until the dust settles a bit?

My parents and my sister in law all recently lost their jobs and it's all very very frightening.

CCCS should be able to give you the rundown on who is still charging you interest - which is useful to know whatever you decide to do.

I'm really sorry I couldn't be more help sweetie.

Love Jacks xxx

Deep_In_Debt

IVA scared me to be honest. I didn't want to put my house at risk and my current job is regulated by the FSA so bankruptcy is not an option. Also being on my own and in my 40's I didn't want to re-mortgage my property and struggle to pay mortgage payments for the next 20 years into my retirement and put my house at risk. I have a bit of equity but not enough to clear the remainder of my mortgage and my debts as well.

A lot can change in 5 years. Since I started on my DMP at the beginning of the year, I'm already facing redudancy in August so if I had gone down the IVA route, it would already look like failing. I'm prepared to risk creditors taking me to court for CO's etc but that is a while off yet and I'm sure I can handle that if or when it happens.

I'm lucky that a lot of my creditors have frozen interest and I'm working hard to clear my debts. Extra jobs and really cutting back on my lifestyle that when my review with the CCCS comes up, I will be able to afford more (assuming I have a job then). On the plus side, as I have been in my job for nearly 12 years, I will get a lump sum redundancy payment. It won't be enough to clear all my debts but I will be in a position to make some full and final settlements and reduce my debts that way - not sure that an IVA has that flexibility.

10past6

Thanks to both of you, you've given me something to think about, although as I type, if I'm really honest, I doubt very much I wil enter into an IVA.