Changing Bank Accounts

[Minnie]

As mentioned in a previous post, my hubby is just about to start the scary process of an IVA.

I know there have been several posts recently regarding bank accounts.

He has been advised to change his bank account from Barclays. We went online the other night and he has been able to open a Smile bank account without problem.

Hubby is fortunate in that even though he is having to go down the IVA route he has been able to keep up to date with payments so far but this is getting beyond manageable and I am having to subsidise. However, this may be the reason he was accepted because his credit report would still be looking relatively favourable at the moment.

Smile, though is still worth a shot as it was really straightforward.

[BECKY]

Hi i went with smile before my iva started too. Ive been in my iva a year now with no problems with them

[Oliver]

Thanks for that Minnie.

Hope all goes well with your Husband's IVA proposal.

Best Regards
Oliver

Thomas Charles and Co Ltd.
Experts in personal debt solutions.
Read customer feedback at: www.thomascharles.com/about_us.asp

[Minnie]

Thanks for the replies.

I am a little concerned about a phone call my husband received today. As you will be aware we are only at the very first stages of IVA - creditors have not been written to yet.

Hubby received a call today from an admin member of staff working in the IP office regarding a personal statement as to how he had got into such debt and now found himself in a position not to be able to meet the repayments.

Unfortunately (or fortunately) there is no dramatic reason as to why he has reached this stage i.e. he is still in paid employment with reasonable wages; he has not suddenly had a huge bill to pay that has had knock on effects. He just simply finds that all his wages now are having to pay his credit cards and loans without leaving anything else for other bills and which, if we don't do something about it now, will mean that because I am now having to subsidise - most on credit card - if we are not careful we will both end up needing an IVA agreement.

He pays £182.00 to his Barclaycard but well over £100 of that is interest. Because he has no money left in his account to pay for other bills he needs to pay for he has to use month by month the limited available balance.

I don't need to tell anyone on here the outcome of this.

I am concerned that because he does not have a dramatic reason as to why he is now in this position that this will go against him when his IVA proposal is put before creditors.

[poppy]

Hi Minnie

Please try not to worry, my reason was simply living beyond my means (I think I thought I had J-Lo's money!) and my IVA was accepted. I also worried my reason was not dramatic enough and was in exactly your position and using credit to repay credit.


Which company are you using for your IVA?

[aguise]

Hi Minnie as Poppy says it is normal to make this sort of statement and is always included in the proposal lots of people cannot really put their finger on how the debts build up including us also. We never had anything expensive, no holidays abroad or anything like that, so dont worry.

Ang

Please visit my blog at http://aguise.blogs.iva.co.uk/

[Minnie]

Thanks Poppy and Aguise - both of your replies are reassuring.

Like you we don't live a lavish life style; don't go out eating in fancy restaurants and don't buy designer clothes. We have found that each time the credit card company has increased our limit it has helped release more available funds, which we have used and like most people you then find you can only just about manage the minimum payment; the interest is increasing and you get to a stage where it is becoming difficult to manage.

Hubby has managed to meet all the payments up until recently but this means that when his wages go in they are all taken by credit cards, loans and the CSA.

This has had a knock on effect in that I am now having to pay for the things he cannot pay for, which is now pushing my credit cards up. It was when this began to happen regularly that we realised things had gone way beyond manageable and we needed to do something about it.

[Sensible77]

Hi, Minnie. Your husband's situation sounds very similar to mine. I built up credit card debt of £75,000 over 15 years, which works out at £5,000 a year.
When people hear about the amount of debt you are in they ask what you spent it on, a Ferrari or a round the world cruise. They don’t appreciate that it is debt built up over time, not in one go. Like your husband, I could continue to pay my bills by using my credit cards, but eventually the money ran out. I contacted PayPlan at the end of March this year, and my IVA was approved on 13 June. PayPlan also required a brief summary from me explaining how I had got into debt. They don’t use it to judge you, but your creditors will need to see it as part of their process. Although I wasn’t completely honest with my wife in the past, she has been very supportive, and you will really need to work together top make it successful. Please make sure that you and your husband fully understand what is involved and that your income & expenditure report is accurate and the proposed repayment is achievable. With regard to changing banks, I banked with HSBC, my largest creditor, but changed to the Co-Op, who I had no financial interest with. I opened a normal current account with no overdraft facility, as an overdraft is not allowed in an IVA as it is unsecured debt. Good luck to you both.

[Minnie]

Thank you for sharing your experience Sensible.

We are honest with each other and he is fully aware I have registered with this forum.

I could never share with my family the level of debt we are in but it is good to be able to share what we are going through with people in similar situations who can also understand how you get in to a mess like this and who don't judge you.

I feel ashamed of the debt we are in and wished we seen it coming but then don't we all!

[Sensible77]

Hi, Minnie. We also haven't told anyone about our situation. There's no way they would understand and whatever people may say, not being able to sort your debt out is still seen by some people as if you are an outright failure and should be paraded through the streets saying so. It’s funny how some people become holier than thou and think that they’re an expert on telling you what to do and have the right to do so! I had some bad feedback from another forum, but that’s history now. The only people who do know are the people on this forum, who are fantastic and, of course, my IP.

[Minnie]

The support here is good and reassuring to know that you are not the only one in this situation.

I do feel ashamed we have reached the level of borrowing we have but now have to find a way out of it.

It is easy to say that if the credit card company increases your limit you don't have to use but when it is there it is not always that easy to walk away from it.

Despite a lot of our situation being self-inflicted as they may say, the credit card company has to start and take some responsibility. Just because someone is reaching their limit does not mean they need an increase - what it can usually mean is that they are using their credit card to pay day by day expenses and may start to run into trouble in the future.

It is easy enough for a credit card company to determine just what the credit card is being used for and to see a spending pattern.

This by no means is my way of moving blame away from myself and hubby but apportioning some it - not all - but some.