I am currently entering into an iva but am worried

[r.s]

Hi Iam only 21 with £20,000 of debt. I am currently entering into an iva but am worried about on particular aspect. I work in retail and want to develop my career eventually moving into management, which means alot more hard work, longer hours, but ultimately more pay. Will all the excess income i earn go into the iva? Or is it fair to say that has income goes up living expenses do.? I understand it is completely fair to pay more if you have more but at the same time im wondering if theres any point on taking on additional pressure (taking into account i have been in hospital twice suffering from depression that has been brought on by this situation) to earn more nmoney when i will not benfit and based on the fact my proposed budget is extremely tight and does not seem to take into account expenses such as the dentist and eye appointments which obviously are important. Also I am close to passing my driving test which my parents have paid for and when and if i do pass they will allow me to use their car if i pay the monthly insurance for myself - This was one of the things i thought i would be aloowed to do if i earned more money but I am not so sure now.

There doesnt seem to be any literature about earning more money on an iva just you pay more - surelly its not as cut and dry as this? My proposal, so i have been told is "extremely generous" by an insolvency practioner and is over 50p to the £. And considering the £1000's i have paid in unjust charges in particular from HSBC i will pretty much be paying back every penny i physically spent anyway. I would be grateful for any adivce. Im just extremely worried about the above. Thanks

[freelili]

hello and welcome

If you feel that you could pay all of your debts back in 5 years with your possible promotions then this would be better than entering into an IVA. Which company are you using? I know it does not feel like it to you but your debt is reletively low in IVA terms. Although Only twenty one you are approaching this in a very mature way, it is not an easy route by any means as I am sure you have worked out for yourself. I think it would be an idea to post more details of your case, just so one of the experts can advise you further. I am sure that should you decide to go down the IVA route, that you will be allowed a 'car expense' fund, however it is a concern that you have not been allowed anything for things that might crop up such as prescriptions, eye tests etc and as you have said, you have been in hospital for depression twice due to the stress of the debt, is this something that could reoccur and result in loss of earnings? Please understand that I am not judging you, believe me I know what debt stress and antidepressants are all about. It might just need some one else's expert opinion as I am only another person in debt. Did the company you approached explain other options to you? Although I said earlier that you seem to be making a mature approach by asking advice here, it is important to remember that, debt stress can result in desperation and a willingness to agree to anything in order to address the problem. I feel it is important that you consider everything carefully.

Hopefully someone else will be along in a while.

Take care and good luck

LILY

I believe that angels breathe and love will live on and never leave. I cherish all you gave me everyday.

[MelanieGiles]

Hi rs

I am firstly concerned that you say your current IVA budget does not include things for medical expenses and other contingencies. Why not? The proposal is your proposal and not your IP's. Have you told them about this expenditure - and are they refusing to include it? If this is the case, then I would seriously think about whether you are going to be able to sustain the payments in the long term.

With regard to increases in income, the very spirit of wanting to enter into an IVA is that you will repay creditors as much as you can afford to over a five year period in return for them agreeing to write off a percentage of your debts. This cannot be unfair, however you must ensure that you allow sufficient expenditure to allow you to live a relatively comfortable existence. At the moment you are young and are possibly still living with your parents. In time you may seek to move into rented accomodation, and run your own car - and your IVA need to be flexible enough to deal with these lifestyle changes and not be to rigid that you get fed up of it halfway through and give up.

Have you also considered whether your parents could offer a lump sum to you to repay your debts via an IVA and then you could use your disposable income to repay that debt to them directly. This is often a better way forward for young people, as parents can often be more forgiving than an IVA supervisor when if comes to missing the occasional payment. Just a thought, but you need to know that this is an option for you.

Discuss your concerns with the IP you have chosen to represent you, and good luck with the proposal and your future career.

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

[tracy.h]

Hi rs, welcome to the forum,
if you enter an iva and your earnings increase then you will be expected to pay more into your iva,as creditors will expect as much back as you can afford to pay,and this is rightly so.
As Lily says you have to look at all your options,and consider the best approach that is viable for you i would suggest you contact one of the companys that post on here to find the best way forward for your circumstances,if you post details of income and expenditure then an expert will be a long to help give you the advise you need.

Tracy

[tracy.h]

Sorry Melanie posted at the same time

[Adam Davies]

Hi r.s
If you do enter into your IVA then continue with your promotion,you are only young and you can put all your energy into your job and progress.Make sure that you cover all your increased expenditure [this includes the costs of running your car] each time you get a pay increase,simply ask your IP for a new income and expenditure form.
Good luck and please keep posting with any questions or thoughts that you have.
Regards

Andy Davie
IVA.co.uk Spokesperson and site manager
(aka Neverending)

Please check out my blog: http://andydavie.blogs.iva.co.uk

View my profile here:
http://www.iva.co.uk/andy_davie_profile.asp

[r.s]

Hi everyone thankyou for all your replys, really appreciate it and can't believe I have found a website like this after all this time.

Just wanted to give a bit more info about my situation - I was on a debt management plan for over 7 months, until last month with churchwood financial which was ok as most creditors agreed to freeze interest. But bascially due to HSBC, having an overdrawn bank account and loan repayments not being met at the full amount - even though the amount i owed to other creditors was slowly going down HSBC have been charging me left, right and centre, with fees so my debt level has actually increased purelly because of them. Apart fromt he fact i cant bear the harrassement of them calling me 20 times everyday, they have only recently stopped since i mentioned section 40 of the adminstration of justice act and informed them i had contacted the fsa over their unlawful behaviour and i was now keeping note of the times and names of calls that they magically stopped. They were the only creditor that wouldn't speak to churchwood and even acknowledge them. Since i went back into full time work i had enough money for an iva so decided this was the best route because with 29% of my debt being owed to HSBC it was not going to go down.

I can't ask my parents for any more has my dad has already taken on as mucvh as he can over £7,000 and is just paying it off and has told me pay it back when i can.

My iva meeting is an wednesday and i am with a company called kingsgate, so i am really, really scared about what is going to happen and can't think about anything else.

I have got myself into such a state and have completely changed my attitude in the last 7 months and just want to sort this out now but i really can't handle any more stress. I'm upset about how HSBC have conducted themselves with their unlawful harassing behaviour but i just can't waste any more time and energy on them any more as they have brought me down so much. I find it shocking i owe double to another creditor and i had one freindly phone call in that time and they were compeltely understanding as they could see i was paying off as much as i could even though it was only through the debt mangement plan.

I would be grateful for any more advice, comments etc


Thankyou all again for your comments


kind regards

[MelanieGiles]

Hi rs

Well as the DMP has not really worked for you, I guess the IVA is a better solution, but have you also considered bankruptcy proceedings? If you have no assets, then this might be the best way to achieve a fresh start.

As Andy says, do not put your life on hold just because you are in an IVA. Whilst it can be galling to have to pay increased monies as a result of career success, you did borrow the money in good faith with the intention of repaying it. Who knows, you may even be able to reduce the term of the IVA if you are able to effect an early repayment. You will never be able to re-capture these early development years in your career.



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

[freelili]

Hi

Just wanted to tell you I agree with everything you said about HSBC. They are horrible creditors, I did what you did regarding the harrassment and said I would record all calls.

LILY

I believe that angels breathe and love will live on and never leave. I cherish all you gave me everyday.