I am currently undecided as to whether to go for a IVA or bankruptcy. I owe around £45,000 to 3 creditors (£36,000 to one creditor and £9,000 to the other two). I have no assets and I currently live in rented accomodation. The only reason I am hesitating with an IVA is the fact that I am worried that I may not be able to maintain the monthly payments over a 5 year period, especially as my pay is not likely to rise much each year, if at all and my rent and travel expenses (currently £400 per month) are more than likely to increase year on year. Then again, I fear bankruptcy, because I will almost certainly get a BRU/BRO as a lot of my debt was incurred through gambling and I am not sure whether it will affect my job or not. I don't work in a bank or finanial institution, but I do have certain finance duties such as invoicing, and responsibilities for budgets, etc. I am also currently in a relationship and they have said that they will help out with expenses, but obviously I can't rely on this in case something happens in a year or two's time and we are no longer together and I cannot manage the repayments on my own. I'm in a dilemma and really don't know what to do for the best.
Hi Xmas Baby and welcome.
An IVA is an excellent way of resolving financial problems but must be affordable and sustainable. You would need to do an income and expenditure account to see how much is affordable each month and if there are foreseen decreases this can be factored in at the beginning.
Even if you could afford to pay an IVA the outcome would be decided by your majority creditor and some do frown on gambling losses. However, if you no longer gamble and have taken steps such as attending GA meetings creditors may accept your proposal.
In bankruptcy, you could agree to a BRU of two to three years which may be acceptable to the Official Receiver provided you assist in providing all the information required. Again it would help to show that the gambling is no longer a problem.
Check your contract of employment and speak to HR or the union rep on a no names basis. They should advise on any employment issues which may arise as a result of bankruptcy.
Finally, speak to at least one IP who can advice without charge or obligation. Good luck.
A BRU for gambling debt is not always a certainty, it really depends upon the circumstances and the extent to which the gambling has caused your current situation.
As Michael says, good practical advice from an insolvency professional will be essential for you to understand the advantages, disadvantages and implications of all of the options available to you. With an unsteady income, it might be also sensible to explore the possibility of a DMP as well as perhaps a holding measure until you make up your mind as to an appropriate way forward - at lease to relieve the financial pressure you undoubtedly find yourself under at present.
