IVA Approved but not sure which way to go!

[odd_job]

Hi everyone....not posted for a while but am in desperate need of some advice.

I started the IVA process a few months ago and had my IVA approved on 28th August 2007, however, I'm not 100% confident that it's set to last and am unsure which way to turn.

To bring you up to speed our debts are as follows:

Mortgage £76,561
Secured loan £55,592

Both in joint names with my partner. House valued at £110k-£125 currently on the market at £125k.

My debts:

Loan - £11,415
Credit Cards (2) - £7,245
Overdraft - £950

Partners debts:

Credit Cards (3) - £3,360
Overdraft - £500

Our IVA was initially proposed at £380 per month but following the creditors meeting it was decided that £410 would satisfy their pence in the pound. However, during the early stages of setting the IVA up, we were advised by the company to stop paying ALL creditors (including secured loan) except the mortgage.

As a result the secured loan company were not happy and have passed our account over to door step collections! I've since spoken to them and agreed a solution to purely prevent them calling round while my partner and young child are at home alone.

With regards the house, once it's sold the shortfall to the secured loan company will become part of the IVA - however, while ever the payments are not being met, the amount owed to them will continue to increase and will ultimately increase the IVA contributions (which at £410 are already stretching us to the limit).

There are alot of issues with regards to the IVA company and their conduct, recommending we stop payments to a secured creditor being one of them, failing to respond to e-mails another, taking a "voluntary contribution" from my bank account even BEFORE the IVA was even approved (despite my proposal clearly stating that payments should commence no later than one month after the sale of the house).

We're seriously considering our options and are discussing going BR but are unsure as to how to go about it and in which order to do things!

There are various posts I've read with regards to being able to stay in your house and buy the interest back for £1 plus fees if there is no equity....which there isn't! How does this work? Is it an option for us?

Should we drop the price of the house to force a quick sale (no interest in the 3 months it's been on the market) and then go BR?

Should we simply move out into rented accomodation and then announce BR?

We're really at a loss with regards to the way to go about it?

Can anyone help our fuzzy picture become abit clearer?!!

[mikebdomain]

Hi odd Job

Really, they advised you to stop paying your secured loan? VERY bad advice. They can not include this amount in the IVA as it is secured.

You are obviously negative equity so you will more than likely be able to purchase the BI back from the OR for £1.

I wouldn’t start to offer any advise to you about your IVA, as I am not an expert in that field whatsoever… Only I would like to say there is no way in hell that I would have any further dealings with this specific company… I’m not sure what your position is regarding switching IP at this stage, I am sure one of the IVA experts will be along shortly to answer that.

I am shocked that this company advised you not to pay secured debts.


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[Adam Davies]

Hi
Terrible advice about not paying the secured loan.
Yes if you both go bankrupt a third party[family/friend] will be able to buy the interest in the property for a £1 plus costs[2-300] from the OR but you will have to keep up with the payments.
You will be unable to change IVA providers now,so the choice is carry on with the IVA or petition for bankruptcy.
Good Luck
Regards

Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

[odd_job]

mikebdomain - thanks for a speedy reply, one of the contributing factors to considering BR is because we're not overly keen to line this companys' pockets and can only forsee future issues with them.

Andy - thanks also for a quick response! Could you clarify, when you say "keep up with the payments" do you mean both the mortgage AND the secured loan? Is there any possibility that the secured loan would be included in the BR or would they automatically force the sale to recoup some of the monies owed?

Am abit unsure also with regards the amount of debt in my partners name Vs being able to go BR? The only way we were able to include her debts in the IVA was from the shortfall of the secured loan (being in joint names) following the sale of the house?

[MelanieGiles]

What a shame that you are considering bankruptcy so soon after having an IVA accepted. Are you sure they told you to stop paying the secured loan? If so that was terrible advice, and I would personally be asking the IP to make good the arrears, although on the basis that you were not paying anyone you ought to have that money available to pay over in any case.

This post serves as a warning to others - if it doesn't feel right, either from the IP position or the proposed repayments, then it isn't going to be right. Go with your gut feeling and if that is not good then find an alternative provider or at least get a second opinion.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

[odd_job]

Hi Melanie,

They really did say to cease all payments, including the secured loan. In fact, three of their employees on three separate occasions all said the same and in all three conversations I asked "are you sure?" at least once!

Now they won't even comment and insist that I should of maintained payments to the second charge!!

Neither will they comment on the amount they've taken from my account prior to the IVA being accepted.

I'm just trying to focus on sorting the mess out and not lingering on old news as best I can.

I really don't know which way to go with the whole BR process though?

[emma_t]

Sorry to hear of your current situation, it seems you hd some really bad advice.
I think you may find some of the blogs on this site from people who have gone bankrupt a help if you are considering this going forward.
Also any questions you may have this site is great for getting some quick responses from people who have been there and expert advice also
Good Luck