In IVA but considering bankruptcy

[chris.g]

I just want to add that since we took the decision to both declare br, we have been much more relaxed and happier. It is such a hard thing to come to terms with, but once you it will become less scary.
This forum is a wealth of information and support, you can always rely on it for honest, non-judgmental advice.
And remember, your home is where your family is, but you don't have to own it.....

[NotSoBrightSpark]

Thanks again Chris for the useful advice.

I think that bankruptcy is favourite at the moment.It is the amount of debt that will bring us down in the end I think.
You're right about the house too.We've been through the mill the last few years,life has been no fun at all.Everything is a chore.But you know what,there is nothing that can hurt me any more,I've gone through hurt,I haven't quite emerged the other side yet but hopefully I soon will.

Bankruptcy seems a bit daunting at the moment but with the help of people like your good self,I'm sure we'll get through it and be better and happier people for it in the end.

And I'm pleased everything has worked out well for you Chris [:)]

[chris.g]

You could try reading this:-
http://skippy13.blogs.iva.co.uk/
She's one of the many of us who have gone through br and come out at the other end. It will give you an idea of what to expect and experience in br. [:)]

Skippy, I hope you don't mind me advertising your blog....[:X]

[NotSoBrightSpark]

Thanks Chris.

I'm off to read through it now. [:D][;)]

[neil277]

Hi SJW

i understand and i was wrong i thought if i helped them out they would help me, this is not the case i have to be as hard as nails with the Courts and working overtime to pay my debt off is a very silly thing to do.

Its nice to get the best advice.

Thanks.

Neil

[MelanieGiles]

Hi there

An interesting post and some quality advice already provided by the other posters - as usual!

From a professional point of view, I look at this in the same way I would advise you if you were my client. A variation to offer creditors the eventual sale proceeds of your house, plus and extra years monthly contributions is not a sensible offer. If you can pay for another year, then you can pay for the remainder of the terms - is how creditors will view that, and if you only have £9k worth of equity in the property now, that is likely to diminish in a flat housing market.

Under bankruptcy proceedings, you will be allowed to stay in the property for the first year, whilst you make alternative living arrangements and over that period the value of the property may well diminish leaving you with little beneficial interest ot buy back.

It seems to me that you have tried the IVA, but that the level of payments is just too much for you. Have you thought about offering to reduce the payments over the remaining term and, if so, to what level? This could also work, but your own IP ought to be giving you advice on your options as well. What do they say is the best thing to look at doing?

[NotSoBrightSpark]

Hi Melanie,thank you for your reply.And I totally agree, some very useful and informed replies to my post already.It is much appreciated I can tell you.

The equity plus a years payments offer I have floating in my head is not necessarily a years payments of the same amount we are contributing to our IVA.I would perhaps offer £200 a month,for one or two years.Let me stress that,I haven't discussed this with my IP at all yet but I did ask her for some lump sum figures that we would need to clear the IVA as soon as possible.These figures were beyond us by some way.

It is the amount of debt and the length of time needed to pay the IVA off that is the problem.It seems never ending.My wife and I are commiotted to finding a solution as quickly as possible.(if one exists)

I did voice my concerns to my IP about the £400 a month and she sent us out another expenditure form which we duly filled in.This new one showed we had £360 a month surplus,she deemed this acceptable but another 6 months was duly added to the length of the IVA (this was agreed and implemented by the IP with no discussion or meeting with the creditors as far as I know).These payments are just about payable by us,but only just.Things are really,really tight.I work to pay the mortgage and the bills,plus the shopping and that's about it.I suppose we may be able to drop payments even more if discussed with our IP but again this would undoubtedly lead to extra length on the IVA agreement.My wife and I are adamant we don't want to do this.

I'd also like to say,we have no assets apart from our house and our car.A charging order to cover the finance on the car is already in place on the property for £5,500 even though the car is worth only around £3000.

If it were not for the charging orders there would be enough equity in the property to pay off the IVA [V]

I'd also like to say that our IP is helpful,friendly and polite.I have not discussed possible bankruptcy with them yet.

Thank you again.

[MelanieGiles]

If I were your IP then, I would firstly be establishing exactly how much you could comfortably afford to repay, and then looking to see if that formed a sensible offer to creditors which could be sustained until the end of the IVA term. They do not need to achive 25p in the £, or extend the IVA past five years, so I would have further discussions with them in this regard before deciding what to do.

[NotSoBrightSpark]

Thanks again Melanie.

My IP has stressed in the past that the creditors would be unlikely to accept less than 25p in the pound but I suppose I can only ask.She was also adamant about the 25p in the pound when I asked her for lump sum figures.

May I just ask a quick question regarding bankruptcy..

If we were to become bankrupt,would it be granted as the judge may think that if we could pay £400 for eight months (which we have) and are now supposed to be paying £360 a month (I've missed the last three payments,two of them with permission) then they could just make us keep on struggling on with the payments? Or would that be unlikely? I'm quite prepared to pay what I can reasonably afford to an IVA or a IPA. You see I'm picking up the lingo already.. [:D]

[sjw]

neil, i totally understand your thinking you just want to do you best to pay your debt off, i hope things work out for you , but don't work so hard that you forget you have a life x
sue x

[chris.g]

I'm not sure if your ip has to fail the IVA or if you would ask them to fail it.
We went straight for br as we had nothing left to offer creditors. The judge asked us what else we had tried, so I'm assuming it would be the same with you. You could explain that the payments were too demanding etc.

[NotSoBrightSpark]

OK Chris,I think I understand.

Thanks for all your helpful contributions.Most appreciated [;)]

[chris.g]

You're most welcome, any time. [:D]

[MelanieGiles]

Hi there

Do remember that putting a variation in front of your creditors is your prerogative and not your IP's. They do not have to recommend it, but they do have to put it forward if you insist.

Another point about bankruptcy - remember that you are the customer when you go to Court and you are asking the Judge to do something for you. If you demonstrate that you clearly cannot afford to make the repayments, and have decided on bankruptcy rather than a varied IVA, then I cannot see that there will be a problem in getting a bankruptcy order.

If you need some help with this, I can recommend Paul Johns of Reviva, who provides an excellent service in negotiating with IPs and trying to find a sensible compromise. He can also help you with the bankruptcy application if you feel you need that, but the forums are relatively straightforward and can be downloaded from the Insolvency Service's website.

[NotSoBrightSpark]

Thank you very much for the advice Melanie.

I have been searching for some good advice for what seems like years,infact it is years.The whole area is a minefield.
I find this forum just yesterday and already I have received excellent and clear advice even though my original post was on a Saturday evening and even now on a Sunday afternoon I am still receiving extremely helpful advice particular to my situation.

This forum is a credit to the people who contribute to it.

I think I'll have a word with my IP and take it from there,there is no harm in that is there but I will say that bankruptcy is looking likely at the moment.

I just have to come to terms with losing our family home.As already mentioned though by other contributors,renting is not the end of the world.Infact it could be the beginning of a bright new future.

I shall keep posting and if I can offer advice to somebody else then I will.

Thank you all,most appreciated [:)][;)]