I think I've become addicted to this forum! So much good advice, knowledge and people who just get it!!
Anyway..I've read so much legal jargon, leaflets, stuff on the net but I still don't understand the difference between bankruptcy and an IVA. I'm pretty sure an IVA is the right option for me, and I'm sorry for being a bit thick, but what is fundamental difference? You all talk plain English here, so may be I'll understand finally!
Last edited by Suesa77 on Wed May 29, 2013 5:48 pm, edited 1 time in total.
BR is heavy duty and you might be stripped of all assets if worth anything, like car over £1500 and house if there is any equity. You will be BR for about a year but might have to make payments for 3 years. Some jobs will not allow BR's so that could be at risk too.
An IVA lasts, typically, 5 or 6 years ( it can vary), the house is yours to keep as well as a reasonable car, although equity will need to be addressed ( make sure you really discuss this point with your chosen IP).
Finally -- BR won't fail, an IVA can.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
do you have assets to protect or a job which could be affected by bankruptcy? If the answer is no then BR may well be the easier option(not easy just easier). Even with a payment order a large amount of your money will not end up paying fees to an IVA firm. Both totally screw your credit file.
Paul
Discharged today the 8th feb 2012. View is much brighter now.
Continuing to rebuild our credit worthiness.
Either option could work for you, but only you can make the decision as to which is best.
One key thing I think it is important to remember is that you remain in control in an IVA, of making your offer and waiting to see if creditors will accept it. The real decision as to whether to continue with the IVA process can then be made when you know if your creditors will be supportive. With bankruptcy, you will rarely know the outcome and the effect on you until the bankruptcy order is made - at which time if you don't like the outcome it is difficult to U-turn.
I meant in the stages leading up to the creditors meeting, where the element of choice still exists. People in IVAs should remain in control even when the IVA has been accepted, however, because the IVA is based upon their then current and ongoing and changing personal circumstances. I would like to think that most of my own clients still feel in control of their lives and finances.
I know I considered both BR and IVA before deciding on the IVA. My main reasons for choosing an IVA were that I wanted to keep the house and I felt that an IVA would enable me to keep some control whilst still making some monthly payments. Although I am very new into my IVA arrangement I am very happy with my decision. I also get the feeling that if things go really wrong in an IVA, BR is still an option, but I am not sure if you can do an IVA after BR, just a thought.
I fail to see how anyone in an IVA is in control of their situation at all, then perhaps thats just me. The creditors appoint an IP who see that the creditors return is as close to 100% as possible, I understand that, you have to submit pay slips P60s etc every year for a review because you are not trusted to give the amounts yourself, they decide what you spend and the amounts you spend,you may get to keep your home but if there is equity, creditors want it either by remortgage, extra payments or secured loans which are being discussed, if you want respite from the payments because you are ill, or out of work you have to ask nicely for it,if it become un-affordable you have to ask a faceless stranger if you can some money back each month to live, the faceless stranger will point out the threat of failure after paying in thousands half way through and lets face it you only get a discount on your debt when, and if, you manage the final payment which some never do, I am not saying IVAs are a bad remedy, to some they are a great and the only remedy but as for control, no I cannot see it
I think it is fair to say that the debtor can accept or decline an IVA at the meeting stage if they are not happy with the payment level fixed by the creditors.In bankruptcy you will not know the exact payment level if an IPA/IPO is made until you are actually made bankrupt.
I think that gives greater control
I can feel some frustration from The Major. I can only share ny experiences and for me I was sinking in unmanageable debt and was getting further in debt every month. Now I am in an Iva my monthly outgoings are way less including the Iva payments. This, to me, leaves me feeling better about myself and in control of my finances compared to where I was a few months ago.
All options should be considered, bankruptcy can often be the best solution on paper, however even if it the best route not everyone wants to go down it.
I think The Major is being a bit harsh here. When I went into my IVA I chose the IP I wanted to use (I didn't make a good choice but that's neither here nor there), when I went BR I was allocated to an OR and had no say in the matter. I had no idea what expenditure I would be allowed until I had actually gone BR.
I had a pay cut while I was BR and I had to ask a 'faceless stranger' for a reduction in my IPA payments. They were reduced but they wouldn't reduce them by the same amount.
Both an IVA or BR are excellent debt solutions but you really need to consider all yor options before making a decision.
