We have a disposable income of £571 (not including loan/credit card repayments) our income is £2000 per month net. We also receive an annuity of £6000 every November. Should we add this figure into the calculation? (We have an agreement with our bank that this years will pay off our overdraft so will not be able to be taken into account).
Also, our biggest loan is with our bank - will we have to change banks if we do an IVA and they are a creditor?
Would we have to sell our car which is worth about £7,000?
If you are going for an IVA, then your overdraft will be included in that and your annuity will not be needed to pay it off.
If it is a permanent thing, then it will be taken into account when sorting out your figures.
If your bank is a creditor, then you will need to change.
Your car should be ok.
How far down the IVA route are you?
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The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
Your £6000 although not needed to go dirctly to the bank in November, will be classified as a windfall I would have thought and all of this would probably have to be given to the IP for distribution to all your creditors.
Your bank will not be able to receive the £6000 in totally without it affecting your IVA as it will appear that you are favouring one creditor more than the other !
You may find that your car is at the higher end of the car price allowed to retain - so be prepared to be asked to change it ! Again giving the balance into your IV for the benefit of your creditors.
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There is a solution for everyone .... Just need to stay positive !
Our car was worth approx £8,500 (only two and a half years old at the time), we were allowed to keep it with no questions asked.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
Ours was, I even queried it on here and was told that as it would now have to last me the full five years, there shouldn't be a problem keeping it. I had my arguments ready if it had been queried at all, but it was never mentioned.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
I think they are probably allowing a bit more leeway on cars as a reliable one should not be costing you a great deal in maintainence. I hope ours will be ok apart from the MOT for the whole period.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
I would think it's false economy to ask someone to change a car for something cheaper (unless of course it's something really extravagant!). As Jan says it has to last 5 years, so changing the car would probably mean something older, which may need more work.
Also, I would expect that the price of used cars is dropping at the moment, so it might be worth less than you would think.
On the whole your car should be OK but depends whether needed for work as well as social. Speak to a few Ip's by visiting www.IVA.Com but you would need to specify your total indebtedness any joint debts. The Annuity will come into pot to give more dividend to your creditors. If your bank is a creditor then arange to change your account. Good luck
Regards, David Mond, Insolvency Practitioner for over 46 years. Personal Insolvency Practitioner of the year 2012, Personal Insolvency Practitioner of the year finalist 2013 & 2014 awarded by Insolvency & Rescue Magazine and 2015 finalist for Personal Insolvency Firm of the Year.
I have never seen a creditor demand the sale of a car worth £7,500 in an IVA, where presumably it has to last for the next five years.
It would be very wise for you to seen ongoing banking arrangements with a bank to whom you do not currently owe any money - as banks do have the right to set off credit balances against debit balances in the event of customer default.
How much do you actually owe to your unsecured creditors?
