I am in an IVA and have been for 7 months. I live with my wife but have no claim on the house. I have no assets. My debt is for £26000 with 5 creditors. They are all in my name only. We have just found out that we are having a baby in September and to be honest my IVA provider was not very helpful when I said that the monthly payments are too much. My partners outgoings were included in the original documents drawing up my IVA something I wasn't happy with but needed apparently. So some questions
1. I have zero assets is it better for me to bite the bullet and declare myself bankrupt.
2. My partner has the mortgage in her name and has lived here for 11 years. I moved in 3 years ago. Can we keep the house out of the bankruptcy?
3. I work full-time in a very secure job. Is this looked upon as favourable?
4. I do pay toward the running of the house and give my wife £200 pm for housekeeping. Is this a reasonable expenditure?
I've asked enough! I just feel that another 5 years with Payplan on an IVA whilst having a new baby and all the expense that will be will hurt us even more. I just want a fresh start for me and my kiddy.
Hi. I could have guessed who you were with well before I got to the end!
You have a couple of choices:
Have a word with another IVA firm ( who isn't funded by the banks and does not take the partners income into the IVA -- effectively making her pay a part of your debt) and re - start a new IVA. Or:
Take the chance and go BR. From what you say, it is unlikely that the OR will have an interest in the house, but, if there is a fair bit of equity, he might argue that you have acquired an interest by virtue of the residence, relationship and financial contribution ( in much the same way as a lawyer would argue over a split of matrimonial assets in a divorce case with similar circumstances).
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Bankruptcy does seem an attractive option and your board payment is quite low. I agree with Foggy that it could be worth speaking with an independent firm to see what if anything you would be required to pay in bankruptcy. This could save you a lot of money in the long run.
Who would be the best people to talk to? I don't want to talk to Payplan about it and I am long in the tooth to realise that there are financial institutions out there who are not strictly independent.
Cab might be a good start for initial advice, but anything deeper and they will refer you to one of the larger Insolvency firms, probably Grant Thornton.
Payplan and Step Change are both funded by the banks.
I would suggest having a chat with one of the smaller firms, like McCambridge Duffy. Yes, they get fees from IVA's and will get no return from BR, but I am confident that, if BR is the best route they will include it in the list of possibilities.
What a good firm will actually do is go through your circumstances and present you with the pros and cons of all available options -- at the end of the day they will adbide by YOUR choice of solution
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
When the IVA was born in 1986 although a great debt solution for some it was not meant for someone like you in mind, someone with no assets. With regards to the property where you live as this property is not and never was in your name the the OR has no claim upon it, it is the duty of the OR to prove a claim not for you to prove otherwise,if you end up with an IPA then you will have to agree to it to be binding, worry not about the allowances they are similar to an IVA you can even claim a monthly holiday allowance of around £60 in bankruptcy if you have a small family. Your IPA payments (if you get one) after one year will not increase even if your income increases drastically, if an IPA becomes unaffordable your debts are still dealt with, the IPA is squashed unlike at present where you can no longer afford the IVA, finally Stepchange do a great service you will be in safe hands
An Income Payments Agreement becomes an Income Payments Order, they are essentially the same, the agreement allows you and the OR to agree a figure which is fair to you both, to be honest without knowing your exact circumstances it is hard to comment however if you are only paying your wife £200 per month I think she is in essence paying your present IVA payment, I can tell you with certainty that your allowance towards household expenditure will be more than £200 per month in bankruptcy
Without knowing the full full details it's very difficult to say whether BR would be the right option for you and I agree with Foggy, it would be good to take advice from one of the smaller companies like McCambridge Duffy.
If you do have to make a payment into an IPA you will pay all of your disposable income for 36 months which is why it's important to get your expenditure correct. If your circumstances change during this time you are duty bound to inform the OR and the IPA will be adjusted accordingly whether that is up or down.
If you agree with the OR's figures you will be subject to an IPA. Should you disagree and not be able to come to an agreement with the OR then they are entitled to apply to the courts for an IPO.
My original debt was £26000 to 5 different creditors. I entered into an IVA with Payplan taking into account my partners earnings and me paying into the household. Our earnings are £1198.41 for me and £1434.00 for her totalling £2832.41. Our outgoings are £2504.22 a month. Leaving what they feel is a fair amount to pay which is £328.16. Now the thing is this doesn't sound a lot compared to my wage but I have barely left every month. I have contacted Payplan and they have told me to work out what my partner will earn on her maternity leave to move forward with the IVA.
I feel trapped in this as I still have 5 years to pay.
Based on your figures you should only be paying about £138 per month to any IVA as the rest of the combined surplus would belong to your wife. This assumes that there was not already an allowance for her own commitments but it is not correct to take her surplus to fund your IVA and this would not happen in bankruptcy.
If your wife is due to go on maternity soon any surplus could reduce or disappear anyway so continuing on at this level seems unsustainable.
Thank you for the figures, I can now feel confident that your liability to pay into an IPO or an IPA which are the same is zero,please be aware this is my opinion as a contributer on this thread, and that to date your wife is in essence paying your IVA from her surplus income. I can also confirm that the mechanics of the IPA/ or IPO as I explained early in this thread are correct, you have no liability to tell the OR of any change in income following your discharge which is 12 months from the date of the petition this is whether you have an order or not. But if you agree to an Income Payments Order or Agreement and want it varied downwards due to affordability post discharge, it can be varied or discharged via the Courts who have absolute control over all Bankruptcies
