Advice - can I get an ISA? Plus hounding letters!

[Lola]

Hi All!

Two payments in for both me and my husband (still away in Afghan but with only ten weeks left!)and so far it's going well. Only 58 more to go!

We are with Abbey at the moment - our new bank account that we set up before going into an IVA. We both have debit cards for the account and no overdraft(obviously, although they keep offering us a £1,000 facility and seem mystified that we don't want it!!).

Some advice please guys. I'd like to set up an ISA but am a bit worried they are going to do a credit check at the point of application.

I don't want to jeopardise our current account and possibly alert them to an IVA on both of us. Does anyone know if a) they credit check for an ISA if you have a current and savings account with them, both in credit? And b) If I did apply and got refused because of an IVa on my credit file would they shut down my account?

Any advice gratefully received.

Also, have been regularly receiving letters from Egg asking for money/ contact with me despite me telling them time and time again we are in an IVA. Then had letters from HSBC threatening legal action for a joint account balance of £281. Nothing about the £10k I owed in loan and credit card to them!!!

Also had a card from a (debt collection company, I think) called NCO, based in Preson, W Midlands in husband's name saying they were on their way to our address on Tuesday. I called them, they refused to discuss it.

I contacted our IP office, got put through straight away to the guy who drafted our proposals. He took all the details and said he would sort it out - no need for us to do anything! Excellent service!

Anyway, we'll see if the letters/ threats stop now..........

[luluj]

Morning! Can I ask how you will be funding your ISA account ??? Whilst in an IVA any available funds should be made available to your creditors - I appreciate we can sometimes save a little from one month to the next, but would be surprised if this would be sufficient to consider an ISA account?

[Lola]

You certainly can ask!

I can save a little each month as everyone else does but I have also been trying to cut down on food costs and other costings - walking more so extra fuel money etc.

My emergency/ contingency money is also being included. I then propose to put this into an ISA so if I do have a major issue over the next few years then I have some savings to back me up as I no longer have plastic and loans.

I thought I was being careful and planning for any potential problems over the next few years. I'm sensing you feel I shouldn't be doing this?

For me, having it an ISA which isn't on the online banking is less of a temptation to spend the money rather than have it sat in a savings account on the same page as my current account which I can happily transfer cash between.

[plasticdaft]

I think you will have to be careful that the amounts you save in an ISA dont get noticed by your IP and sucked into your IVA. Saving an emergency kitty is one thing but having sufficvient to bother putting it into an ISA surely means theres more for your creditors.
I would hate for you to put money aside and then lose it.

[jpj]

ISAs are quite restricting in a way...to get the full benefit you cant just keep popping money in and taking it out again!
If you put money in one tax year,you shouldnt take it out till the next!
I would just go for a standard high interest deposit account whilst in an IVA.

[Lola]

Thanks jpj and plasticdraft. Some good points. I'd hate to lose my emergency money and may well need access to it in the same year as depositing. So may think about a high interest account - or just leaving it where it is as it's not doing any harm!

[Adam Davies]

Hi Lola
You are free to save what you can,as long as you disclose all income etc,so good luck to you.
Good advice from above,an ISA will not have the flexibility that you may need so best to stick to a savings account.
Regards

[Lola]

Thanks Andy. That's good to hear. All income etc disclosed.

I was a bit worried that I may be doing something wrong.

[luluj]

I wasn't trying to say don't save ....just that an ISA may not be the most appropriate account to use.

We have a Smile Savings Account and all our car maintenance and contingency money goes in on standing order each month so that we have ensured it is put to one side.

Great if you can save a little, just wouldn't want you to get in the trap of having money tied up and unable to get at it!

[Lola]

As you have probably realised - saving is not my strong point either! Probably why I thought as everyone talks about ISAs that it was probably the best thing for me.

Maybe if I was able to save/ knew about banking then we wouldn't have found ourself in this mess!

[chris.g]

I applied for an ISA with the co-op who we have our cashminder account and was refused. It may be that we are br instead of in an IVA but it may be hard. The eldest has opened an savings account for us and we just use that for our savings.

[worryhead]

Hi all,
I was thinking of opening an ISA to a few months back due the better interest rates, but luckily i checked my proposal again and it states i can not open an ISA during my IVA. So just to advise, i would check your proposal before making a decision.

[MelanieGiles]

It's a great idea to have any form of savings account whilst in an IVA, and savings should firstly be used to cover unknown contingencies and unexpected expenditure along the way, before being paid over to creditors.