Debts too young to enter into an IVA?

[princessb]

I've spoken to numerous companies regarding entering into an IVA. I have though only felt completely comfortable speaking to the one I spoke to this morning. More than 50% of my debts are less than a year old, is this likely to cause a huge problem?

I also wanted some advice on monthly figures I've been 'quoted'. I've been 'quoted' monthly payment figures ranging from £320-£490 per month for the IVA.

Halifax are my major creditor, I owe 72% of the total debt to them and I took out a loan to consolidate a 17k loan I had with them and to pay off a store card and a credit card. The 17k loan was taken to consolidate 3 previous loans I had with Halifax. You can see the pattern. The most recent loan I took with them was July 06. Just looking for a bit of guidance.

[accgroup]

Hello

The fact that more than 50% of your debts are less than a year old is not that much of a problem, although I'd have to know more details about how these debts were incurred.

How many other creditors do you have apart from Halifax? Isn't there any chance of you being able to afford to repay your debts without the need for formal insolvency proceedings?

The monthly figure you've been quoted should be the most you can afford to repay - your offer to your creditors should be the maximum amount possible - you should include all your income and all your necessary expenditure to work out the monthly figure - your disposable income. There's quite a difference in the figures you have been quoted and this is probably because the companies you have been speaking to have different ideas of what is necessary expenditure - the best thing to do is for you to work this out yourself, try sticking to a budget for a month (not taking into account and debts which you are repaying) and calculate what you think you can afford before you sign up for anything. Remember to include expenses that aren't paid every month - utilities/council tax/insurances etc.

Hope this helps



AccumaGroup - A large insolvency practitioner service based in Manchester.
www.accumagroup.com

[MelanieGiles]

The advice from Accuma is very apt - and can I just stress to all parties thinking of entering into an IVA is that no-one should tell you how much you should be spending. Your household budget is personal to you, and you are only setting yourselves up for failure if you put false figures down, or worse - be led by advisors who tell you how much to spend.

Let the creditors be the ultimate judge of the reasonableness of your expenditure, and if they reject your proposals you will then have time to reconsider and see whether any economies can be made. There are too many IVA's failing at the moment, due to unrealistic budgets being "forced" upon debtors.



Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk