Banking with IVA

tiggy748_2 · 9 September 2018 at 5:53PM

I'm concidering an IVA.
I have an overdraft of 1500 and a credit card of 2500 with Halifax.

I also have a new account and savings account with llyods. When you spend 3.50 on your card llyods round up the amount to 4 and put the 50p into your savings.

Few questions.... Halifax and llyods are the same banking group. Does this matter?

Secondly if I save using the llyods saving account can the IVA take this money away?

And thirdly I will be having my student loan paid I to the llyods account. Is this classed as income for the IVA? Can they touch it? I will be continuing to work full time alongside my studies.

If I switch jobs during the IVA and my income increases do I have to put the surplus into the IVA? my income is currently approx 19k after graduating I'd expect it to be around 25-28k.

Can anyone recommend a company to handle the IVA please.

Thanks!

Craig1981 · 10 September 2018 at 5:58AM

morning

i would recommend getting bank accounts with no link to any of your debt that will be going onto the IVA.
if you owe nothing to lloyds at all, then there shouldnt be an issue
No, I dont believe a student loan will be classed as income provided it is used for your studies/courses etc, but this needs to be asked/checked with the IP

when on an IVA, you need to do a yearly review on your anniversary date. new income and expenditure to make sure IVA still affordable for both sides. If your income goes up, you excess income probably will to, so yes, you would be expected to increase your payments accordingly

You need to go through Stepchange or National Debtline - they will do the leg work. I was with Grant Thornton (Apeture now), and had no issues at all from start to finish - others have had issues with them though. but using Stepchange, CAB, National Debtline etc they will put you through to a reputable company

National_Debtline · 10 September 2018 at 11:13AM

Hi tiggy748,

Based on your message and if your total debt level is £4000, then I would not suggest you do an IVA. Your debt level will not be high enough to reap the rewards of an IVA and your student loan income would very likely be taken into consideration as an income. Once you have done a SOA I would imagine that your surplus is going to be too high for an IVA compared to your debt level.

Also, when entering an IVA you will lose the credit facilities, and it would seem that in order to get any savings through the Lloyds scheme, you need to use the card, which won't be possible. But in reality you shouldn't be using credit in any option to become debt free.

I would suggest that you post a SOA and consider other options, such as a free Debt Management Plan or even self negotiation. Change banks and avoid the same banking groups, Halifax and Lloyds are linked (as are Bank of Scotland) and hopefully we can guide you on an alternative debt solution if these debts have become unmanageable.

In an IVA,

Craig1981 · 10 September 2018 at 11:20AM

National_Debtline wrote: »

Hi tiggy748,

Based on your message and if your total debt level is £4000, then I would not suggest you do an IVA. Your debt level will not be high enough to reap the rewards of an IVA and your student loan income would very likely be taken into consideration as an income. Once you have done a SOA I would imagine that your surplus is going to be too high for an IVA compared to your debt level.

Also, when entering an IVA you will lose the credit facilities, and it would seem that in order to get any savings through the Lloyds scheme, you need to use the card, which won't be possible. But in reality you shouldn't be using credit in any option to become debt free.

I would suggest that you post a SOA and consider other options, such as a free Debt Management Plan or even self negotiation. Change banks and avoid the same banking groups, Halifax and Lloyds are linked (as are Bank of Scotland) and hopefully we can guide you on an alternative debt solution if these debts have become unmanageable.

In an IVA,

I don't think that the debt is only £4k - the 4k is given as debt with the bank account, as per questions about bank accounts

tiggy748_2 · 10 September 2018 at 11:38AM

Yes that's right my total debt is around 17k. My income.is 1200-1400 depending on what shifts I do.

The savings account isn't anything to do with credit. When I use my debit card to buy something the amount gets rounded up to the nearest £1 and the surplus gets put into the savings account which I can access at any point. It's not credit just a simple way of helping you to save. I wanted to know if I built up any savings over the 5 years if they would take it away

sourcrates · 10 September 2018 at 12:06PM

tiggy748 wrote: »

Yes that's right my total debt is around 17k. My income.is 1200-1400 depending on what shifts I do.

The savings account isn't anything to do with credit. When I use my debit card to buy something the amount gets rounded up to the nearest £1 and the surplus gets put into the savings account which I can access at any point. It's not credit just a simple way of helping you to save. I wanted to know if I built up any savings over the 5 years if they would take it away

Hi,

Your IP would only be interested if your income increases, or you gain significant assets, you have a yearly review with an IVA, so if your income increases, then so do your payments.

If you are able to save money from your expenses budget, then that is fine, anything else, depending on how much it is, may be at risk.

17 k of debt is at the bottom end of been suitable for an IVA, IVA`s are usually an option if your facing bankruptcy, but have a property to protect, the fee`s can be quite high with this arrangement, you would expect the average IVA customer to be in 30k plus of debt and upwards, although there are no min and max amounts in order to qualify.

For any insolvency option, you would need to be using a standard basic bank account, with no lending facility.

Is a DRO (debt relief order) not a better option for you ?

tiggy748_2 · 10 September 2018 at 12:10PM

No I'm a home owner plus I own a car worth 8k with finance. I do have enough equity to pay the loans but am unable to get a mortgage as I'm on zero hours contract plus too low income plus bad credit score

sourcrates · 10 September 2018 at 12:23PM

tiggy748 wrote: »

No I'm a home owner plus I own a car worth 8k with finance. I do have enough equity to pay the loans but am unable to get a mortgage as I'm on zero hours contract plus too low income plus bad credit score

How far have you looked into this ?

For instance, do you know how much your payments would be in an IVA ?

Off the top of your head, how much can you afford to pay towards your debts monthly ?

tiggy748_2 · 10 September 2018 at 3:28PM

I've looked at iva calculators they suggest 170 which would be fine. I could do 200. It really depends on how hard I want to work! I work 13hr night shifts around uni. I could do 2 shifts easily. 3 would be ok occasionaly sometimes 4 and even 5 during hidays exam break etc.
I dont really want uni 3x a week then nights 4x a week that's not great but it's just for 1 year so if I need to work my ads off to atchieve what I need too well.. ..
In the 2nd year it will be easier as I will keep my 9k maintaince loan. But the 1st year it has to go to paying uni fees.

tiggy748_2 · 10 September 2018 at 3:30PM

I was wondering something.....
A very close friend had sever health issues this year and I've supported her financially she now makes random payments into my account to pay me back. How would this be viewed under an I've?

I was going to move all my banking to llyods then wait 3 months to start the IVA so these payments don't get questioned as I've no way of proving she owes me this money and the amount owed.

sourcrates · 10 September 2018 at 4:39PM

Right, so basically a debt management plan would take you possibly longer than an IVA would, so that`s a plus for the IVA.

Small repayments of money your owed should be ok, prior to your annual review, you would need to provide the previous 3 months bank statements, so ideally you would not want it showing on them, it would be ok, but you would have to explain it most likely.

Banking with IVA

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