fine if I am not being misled in anyway

[j_s]

I spoke with 'debtbusters' and they said I was suitable for IVA.They have said I should cancel all direct debits to loans ASAP. They then take £584 from my account and after that put me in for an IVA.

My worries are these:
Is it cart before the horse? By that I mean isn't there a way of me knowing for sure I have been accepted for an IVA before I commit and alienate myself from loan / credit companies whereby there is no return thus leaving me totally in the hands of 'debtbusters' aka Greg Pennington

2. I was quoted £584 as the sum put forward a month that I can afford. What is the likelyhood of it coming back with yes I am accepted but at £800 a month

3. I have been told that this applies to the bank and that I must set up a new account with a new bank with their recommendation. They said I would be unlikely to find a High Street bank that would let me open an account with an IVA
The problem is with their choice you don't get a cheque book or credit card. Is this the norm? Would I be able to open an account with say Barclays. The main problem is that dealing solely in cash presents huge problems

4. I have a Halifax account that I forgot about as it has a zero balance. Would I be able to use this as my current account? Do I need to declare this account?
I am a police officer, I know I should know but is this something my job needs to know about?

Thanks. Its a big decision that once made seems irreversable which is fine if I am not being misled in anyway

[MelanieGiles]

Hi j_s

1. I assume that you are already struggling to make your payments to creditors or you would not have taken advice in the first place. To this end, your creditors will already be aware that you have a problem. If you are up to date with all of your payments, the credibility of why you need an IVA will be questioned.

2. That will depend upon your exact income and expenditure, and whether creditors view £584 as a reasonable sum. There are a lot of creditors who are seeking increased payments at the moment - some of them being quite unrealistic, and you must take care not to commit to something you cannot afford simply because you see it as the ultimate solution.

3. There are many high street banks who will open an account for you. It is entirely your choice where you seek your banking facilities for the future. Make sure you choose a bank that you don't owe any money to.

4. It is fine for you to use your Halifax account, providing you do not operate it in overdraft.

Good luck with the IVA. I have acted for many policemen in my time, and I generally find creditors most sympathetic given that your job would likely be affected by bankruptcy proceedings.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.
View my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[scaredkez]

js i would be very careful about paying upfront fees i fell for this one and lost my money, ask if this will be returned if the iva is rejected, they will probably tell you it will be used towards the iva payment if accepted, do a bit more research and also you will get valuable advice from this forum, is this the first company you have contacted if so speak to others, read other posts from here also, my fees were up and down also.
see if anyone here has used that company and how they have rated but don't jump in headfirst, i wish i hadn't,
best of luck and keep us posted how you get on
kerri

[Dominic]

My IP did not charge upfront fees, be wary and shop around.

[herbek]

Pay nobody ANYTHING.

The initial company I signed up with (Surestart) sent me direct debit stuff with comments of the meeting cannot be arranged until you are seen to be paying. Almost as scarey as the ones from the creditors, but thats the point. I chose to ignore them and as I found out they are just an IVA transit company for want of a better description and they passed my account onto a proper LLP, McCambridge Duffy in Belfast. If the IVA is successful (which it was) they they get paid a fee by the LLP out of the funds I pay in when successful. If you pay them first then first (Surestart) then you loose your money if it fails to be agreed.

When it got the McCambridge Duffy there was not single request for money until I received teh date of the meeting and they expected a cheque to be at their offices on or prior to the date of the meeting for the first monthly amount to be cashed on acceptance. I gave my girlfriend the cash, she wrote the cheque. After that DD.

That is the way to do it and all I can say is that I am happy I had the balls to refuse giving the transit company anything.

PLEASE PLEASE PLEASE anyone reading ths pay nothing upfront.

1. Simply posting here means you cannot afford the payments. Alienating the creditors is really irrelevant. You are going to have to DMP/IVA/Bankruptcy depending on your circumstances. The real point is do YOU act now to solve the problem or let a creditor make that decision for you.

2. My initial quote was £550. I'm on a good wage and my gut feel was no way I can easily afford that. It has ended up at £650. Higher but within my 'Get out of jail free range'. What's you gut feeling? Hard to answer, too many variables.

3. I went online and opened a Natwest basic account with a debit card. No overdraft, no credit that's the important thing. BUT BUT BUT cheque and credit card forget it, these are in the dustbin and are about to become history for you.

4. Depends if yo owe them money and whether you have credit via this account. ie you can have <0 balance.

[freelili]

first direct have closed IVA accounts which has caused some people major stress. They are related to HSBC.

LILY

[herbek]

Can you explain that in more detail.

I have setup a basic account with ahigh street bank and whether I was/were in an IVA or anything was irrelevant and was never asked since I did on the internet.

Are you saying that people that owe them money via an IVA are having accounts closed or that they are checking the IVA register and if they find someone on it that has an account with them they are closing it?

[freelili]

A couple of people on this site formerly opened a basic account with first direct before their IVA only to find they were asked to close the account and were given 30 days to find another bank.

It is easier to open an account before your IVA goes through.
If any money is owed at the bank, they have a right of offset and will claim any money in the account. In my case I owe to HSBC so I opened a basic account with LLoyds and had my money paid into it to prevent HSBC taking any when defaulting on payments was inevitable.
I do not know how first direct found about about the other posters, perhaps the basic banks are informed. It appears to be their policy not to accept people on an IVA.

LILY

[illihor]

I find it quite disgusting that Gregory pennington advised that you would find it difficult to open a high street account whilst in an IVA. The insolvency website itself lists most of the banks that will. This where regulation needs to be tightened.

Many of these case workers wouldn't know an IVA if it came up to them and clonked them on the noggin with a default notice. They want 1 thing from you, money. It's utterly disgusting.

As has been said so many times on this forum. If you pay money up-front the firm already has an income from you, so why should they put as much effort into your IVA?.

I have started informing my IP firm and any creditors who call that I will be recording the conversation. This seems to be the only way to force them to act responsibly.

Kind Regards.

Lee

[Skippy]

The way the banks are treating people is disgusting. To be frank, none of us would be in the mess we are in if it wasn't for the banks lending us the money in the first place. I took out a £25 consolidation loan with NatWest 18 months ago, and when I rang them a couple of months later they asked did I want to borrow any more! I didn't think you could have an unsecured loan of more than £25k? I then took out a second consolidation loan with Egg, DESPITE being honest about my previous borrowings - looking back I shouldn't have done it, but I didn't know about IVAs then, and I was scared of bankruptcy - hindsight is a wonderful thing.

I am lucky - I already had a bank account with Lloyds, and I didn't owe them any money so that meant I could keep using the bank account and keep my chequebook and debit card.

Good luck to everyone who is going applying for an IVA at the moment - I know it's not easy, but you will get there.

Three down, fifty seven to go until freedom!

[razamataz_]

I spoke with 'debtbusters' and they said I was suitable for IVA.They have said I should cancel all direct debits to loans ASAP. They then take £584 from my account and after that put me in for an IVA.

My worries are these:
Is it cart before the horse? By that I mean isn't there a way of me knowing for sure I have been accepted for an IVA before I commit and alienate myself from loan / credit companies whereby there is no return thus leaving me totally in the hands of 'debtbusters' aka Greg Pennington

2. I was quoted £584 as the sum put forward a month that I can afford. What is the likelyhood of it coming back with yes I am accepted but at £800 a month

3. I have been told that this applies to the bank and that I must set up a new account with a new bank with their recommendation. They said I would be unlikely to find a High Street bank that would let me open an account with an IVA
The problem is with their choice you don't get a cheque book or credit card. Is this the norm? Would I be able to open an account with say Barclays. The main problem is that dealing solely in cash presents huge problems

4. I have a Halifax account that I forgot about as it has a zero balance. Would I be able to use this as my current account? Do I need to declare this account?
I am a police officer, I know I should know but is this something my job needs to know about?

Thanks. Its a big decision that once made seems irreversable which is fine if I am not being misled in anyway

[razamataz_]

Hi j_s [88]
You could always look on nationaldebtline site as they have details on complaining to Office of Fair Trading should you have any qualms about the way a Company is operating, and could then potentially get recompensed for this money. There are certain rules that they need to abide by.Good luck. The Team on here are great.
CLS Community Legal Service may operate in your area but their website has info too.
raza[:)]

I spoke with 'debtbusters' and they said I was suitable for IVA.They have said I should cancel all direct debits to loans ASAP. They then take £584 from my account and after that put me in for an IVA.

My worries are these:
Is it cart before the horse? By that I mean isn't there a way of me knowing for sure I have been accepted for an IVA before I commit and alienate myself from loan / credit companies whereby there is no return thus leaving me totally in the hands of 'debtbusters' aka Greg Pennington

2. I was quoted £584 as the sum put forward a month that I can afford. What is the likelyhood of it coming back with yes I am accepted but at £800 a month

3. I have been told that this applies to the bank and that I must set up a new account with a new bank with their recommendation. They said I would be unlikely to find a High Street bank that would let me open an account with an IVA
The problem is with their choice you don't get a cheque book or credit card. Is this the norm? Would I be able to open an account with say Barclays. The main problem is that dealing solely in cash presents huge problems

4. I have a Halifax account that I forgot about as it has a zero balance. Would I be able to use this as my current account? Do I need to declare this account?
I am a police officer, I know I should know but is this something my job needs to know about?

Thanks. Its a big decision that once made seems irreversable which is fine if I am not being misled in anyway

[jamesfalla]

J_S

I think there have been some very useful points made here.

I do know of some reputable companies who charge an upfront or "Instruction Fee" for the advice they give and for preparing the necessary information to enter into an IVA. In my experiance these companies give an excellent service. However, they all guarantee to refund any monies paid if the IVA is not accepted. Ask about this guarantee and if it is not available, then you need to be very wary.

In terms of the monthly IVA payment, as Melanie says, you must work closely with the company you choose to calculate an accurate disposable income (the difference between your household income and your reasonable expenses). This is the amount that your IVA payments will be based on. As I have said many times, it is vital that once you have calculated your Disposable Income, that you are convinced in yourself that you can afford to pay this each month.

There seem to be more and more occasions where creditors are knocking back IVA proposals and asking for more money. If this happens to you, then think very carefully before accepting the increase. If you do so and then can not afford the payments, your IVA will fail and you will have wasted time, money and possibly tears! It is better not to do an IVA at all than accepting payments that you can not afford.

As lots of the posters have said already, please do not worry about changing your bank account. This is absolutely normal. I agree with illihor that if someone tells you that you can not open a new account at a normal highstreet bank, this is wrong. The only thing to remember is that if you think your credit rating is already bad, then you probably will not be able to get a standard current account. You will have to go with a simple Card Cash account which offers no credit facilities.

This type of account can be a pain as you have to deal with cash only. However, if you find that this is the only account open to you, then don't dispair. Nowerdays, there are also things called Pre Paid Debit cards. You can apply for one of these even with a poor credit rating. You just then charge it up and using like a normal debit card. You should expect to pay a fee for the card through.

Clearly if you do decide to open a new account, do it at a back where you own no money. I understand that you have a Halifax account. This would be fine to use as long as you own nothing else to Halifax (ie no Halifax credit card or loans). If you do, then Halifax can use the "Right of Offset" rule and take money out of your account without your agreement to pay the other debts you owe to them.

Hope some of this helps

James Falla

Expert in IVA, Bankruptcy and informal Debt Management solutions, with extensive experience of solving personal debt problems over the past 10 years. I am regularly featured on BBC News, Finance Programs and Radio.

Visit my blog at: http://jamesfalla.blogs.iva.co.uk

[scaredkez]

i was wondering if you could help me when i changed to a basic bank accout the only one i could find was with lloyds tsb i did not realise at the time that blackhorse was a subsiduary of them, i spoke to synergi about this would there be a problem as i didn't inform lloyds re iva or that i owed blackhorse they said this wouldn't be a problem i am just worried if they eventually realise i owe blackhorse money could they empty my account and try and reclaim some money back that way.
kerri

[Oliver]

It's a very good question. Many banks and lenders have relationships that not everyone is aware of like Lloyds and Blackhorse, Bank of Scotland and Halifax and Barclays and the Woolwich, to name but a few as the list goes on and on. The Right of Offset allows a lender to offset money lent to you by taking monies from any other account that you hold in credit with the same lender. Often these linked companies are run separately so whether, for example say the Woolwich would use the Right of Offset against an Account held with Barclays is doubtful, but I believe still legal, so it would be a risk to not open up a "Clean" bank account. However, once an IVA is agreed you are legally protected from this point and the Right of Offset will no longer be available to any of your creditors as this would be preferential treatment. This unfortunately does not stop banks and building societies from being able to close your account at any point (with a notice period obviously). So I would say that in answer to your question can a bank take your money from your account after an IVA is in place, NO, but can they close your account if they find out you are doing an IVA involving a Sister company then, YES.

Best Regards
Oliver

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