Iva or another unsecured loan please help Soon!!

wigglers · 3 September 2019 at 7:55AM

Hi I am just about keeping our family above the line... I have asked step change for advice, and seem to get different debt remedy advice... Basically I have excellent credit and have been b zero percenting my debt from card to card but then using the cards. So now I am In a scenario where I'm paying minimum payments using the cards to fund our lives and bills and not getting anywhere. Although handbrake missed a payment yet.

I have applied and been offered a loan (haven't signed the paperwork) to clear the debts which would mean struggling for the next 6 years... Or I can get an iva or Bankrupcy.. I love spending time and enjoying life with my kids..

But I know this must be sorted I have 2 choices the way I see it get an iva the debt is clear inside 6 years or a 6 year loan paying more Interest but keep my credit rating .. For a potential house etc...

I am happy to show u my budget but we run a 1.6 bluemotion car no tax cheap diesel, we shop at aldi.. No elaberate purchases etc... But I have a 180 Barclaycard bill to pay tomorrow and if I'm entering an iva Im not sure id have to make that payment...
Thanks{or the advice and listening...
wages £1500
Uni cred £721
child beno £136

=£2357

Existing debts
HSBC overdraft £3000
Hsbc Loan £10529
My Barc. £7834
Cap £1700

Rent £825
Council tax £155
Water £33
Tv licence £12.50
Bt phone + net £30
Gas + electric £72
Partner mobile £28
Curry's £4
Kids swimming £45
Twisto £30
Daughter brownies. £30
Son beavers. £30
Daugter school dinners. £40

*****nationwide**** = 1306.50
Overdraft interest £38
Cap 1 payment £50
Gym £36
My ee mob £46
Netflix £10
HSBC Loan £220
Virgin £0
Barc card. £180
Son football. £20
*****HSBC ***** =562
£1906.50
Car insurance £45
Car diesel £30 a week £120 a month
Shopping £80 a wk = £400 pm

£2471.50 all in

1463.50 no cards or loan

2028.50 no cards or loan all in Inc diesel and shopping

TheGardener · 3 September 2019 at 8:08AM

Firstly - please can I advise you edit your SoA post and remove the personal family names!

If you are aware you are technically insolvent - taking out another loan knowing you have no reasonable means to repay it may cause problems further down the road if any DMP fails and BR becomes inevitable.

wigglers · 3 September 2019 at 8:21AM

I have removed names now... But as u can see I don't want to continue paying large bills if I'm going into an iva if the advice is too or full bakrupcy obviously I earn less than what we owe something has to give

wigglers · 3 September 2019 at 9:26AM

I am looking for advice my head says iva but I'm worried about the fact I could try to clear the debt and just pay the 2 loans off... But I'm seriously struggling with what to do &#55358;&#56596;

TheGardener · 3 September 2019 at 9:51AM

Its a tough decision - for me it was a no-brainer. I faced penury into old age and the impact of the stress was making me ill. I don't regret going BR and 6 years on, my credit history is excellent (although I have no need for credit) It was one of the best life decisions I've made.

No-one can really make this decision for you - need to do the maths and weigh up the pros and cons of the different processes.
With BR - in 6 years it will fall off your credit file and with excellent financial management during those 6 years, your life could be transformed.
With any sort of debt repayment, you still have 6 years but with less money to work with due to the repayments.
I can't say which is best for you but with rent & C.Tax taking up 40% of your income and a young family there are a lot of life events that could get in the way of repayments - illness, redundancy, uncertain economic times in the UK its a tricky decision.

wigglers · 3 September 2019 at 10:28AM

Bankruptcy maybe better than an iva then? 40% of the payments to what sorry? An iva or potential loan? Tbh after checking out the actual figures not even sure I can afford the loan.. Obviously we would struggle but then if I go bankrupt I am looking to perhaps go back to college and study can/would leaving work or working part time affect that?

wigglers · 3 September 2019 at 10:32AM

6 years on you still have an excelent credit rating? Could u apply for a mortgage if u wanted to and obviously we have a car that we use to pick kids up do clubs etc we would need to keep that 100% it's not on hp and is very economical

TheGardener · 3 September 2019 at 10:53AM

"but with rent & C.Tax taking up 40%"

Your rent and council tax on your SoA amount to just over 40% of your total income. That's a big chunk - and doesn't leave much for anything else.

Yes, I probably could get a mortgage but I have no need of one fortunately.
My credit history is excellent (could only be improved by a much larger income) and that is because a) the BR has dropped off my credit file and b) I have managed my finances impeccably since my BR. Until your BR drops off your credit history your credit history is pants - it drops though the floor - the same is true of IVAs, DRO's and DMP's

ACG · 3 September 2019 at 11:18AM

You are spending:
£74 a month on mobile phones - I pay £15 a month for mine.
£155 a month on things for the kids - why not cut one or 2 of them out and spend time with them instead? Take them to the park maybe? I dont know how old they are but my 2 year old loves nothing more than helping me clean the car. That costs nothing, bar some patience with her hands smudging where I have already cleaned.

Do you need a £35 a month gym? Are there no £20 a month ones around you?

You say you get food from Aldi, but then you are spending £75 a month on phones. That is something I always struggle to get my head around. I suppose unlike a lot of what I see you have not £70 a month subscription to Sky.

In your situation, you just need to make a few cut backs on things that are not even important (mobile phones, less activities for the kids and more time with you) and you could start smashing that debt down over the next 12 months - providing you dont get giddy happy at Christmas.

An IVA is a form of Bankruptcy. It seems extreme for something you can sort out yourself. Also as you are renting, if you need to move house in the future you may struggle to pass credit checks, the same goes for mortgages (Although I appreciate that is probably not the priority at the minute).

MEM62 · 3 September 2019 at 12:51PM

wigglers wrote: »

I have applied and been offered a loan (haven't signed the paperwork) to clear the debts

Just to correct you on that, a loan does not clear the debts - all it does is move them to a different lender. You need to hang onto that thought when considering your options.
As already pointed out, there are areas where you appear to be able to save quite a bit on your expenditure. Perhaps some cutting back and looking at options for additional income (part time jobs etc) will allow you to work your way out of this without anything as drastic as insolvency.

I hope you manage to find a solution.

wigglers · 3 September 2019 at 4:16PM

Well my boss pays my mobile contract and its actually 31 but I have a sim only deal which ends Nov so really its 31 and just taken out and my partners 28 is decent for a mobile contract again fairly new. The kids need swimming lessons as it's a life skill I may have over budgeted for beavers and brownies but uniforms etc and dance lessons they enjoy... Tbh it's not their fault our finances are crappy. Its a better idea to get her school dinners as then we know she will be eating.. I have a £30 contract for bt TV Internet and land-line which is a good deal and pay 0 for any sky have switched energy supplier etc. We spend a lot of time with them at the beach doing crafts playing games etc always out on their bikes scooters etc.. I can't see how we can cut back tbh

Iva or another unsecured loan please help Soon!!

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