New, Scared, Uncertain and very worried

[kilohurtz]

Hi,

I have been considering an IVA for a while but am scared about entering into one as I have read horror stories.

I have about £44,000.00 in unsecured debt. At the moment I have not defaulted on any monthly payments but this is because I am living off my credit cards each month to make up the difference.

I was reading on a BBC website this evening of people who entered in IVA's but wished they hadn’t. Some people were saying that once they signed up for the IVA within a few months their payments went through the roof forcing them not to be able to make the monthly payments thus defaulting the IVA. How can I be sure this couldn’t happen to me?

I have a couple of questions I am worried about.

1: I pay £300 child maintenance and see my 10 year old son twice a month. My son lives 400 miles round trip away from me which I do twice a month, this costs about £110 a month in fuel on top of the child maintenance I pay. Would an IVA take this into consideration? I am worried because I am already paying £300 a month they would not allow me the fuel expense on top and I would not be able to afford to see my son.

2: I use a personal credit card for my business expenses each month. This can be anything from £100-£500 a month. The company I work for do not have company credit cards for employees. I have read that once I enter into an IVA that I would not be able to use any type of credit card. There is no way I would have £500 spare every month from my account to pay for my essential business expenses and know that if I couldn’t pay for them I would lose my job for sure. Does anyone have any comments on this situation? If I could use one card with say a £500 limit them it would be cleared every month with fail.

I am one of these guys that seems to give everything to everyone but get left with all the mess once things go wrong. I brought a house 3 years ago with a girl and very shortly after took out a £20,000.00 loan to consolidate all ours debts and get the house modified and improved. I put £30,000.00 equity into the house when I purchased it but turned down the option of a pre-nup at the point of signing for the house. The relationship soon became very violent (towards me) and unbearable with the ultimate cheating sin being committed. I moved out but have continued to pay half of the mortgage for over 20 months now which is £540.00 a month. Initially my ex would not put the house on the market but said she would if I signed a letter to say I would let her have the £30,000.00 equity I put into it. Reluctantly I agreed and had my solicitor draw a letter stating this and it was signed and sent off. The house is on the market and has been on for just under a year now but it has not sold. There is about £12,000.00 equity after the £30,000.00 which will be split 50/50 after the solicitors and estate agents fees have been paid. Will an IVA take this into account as well? They are welcome to have any monies I get out of the house and by selling the house will increase my monthly net by £540.00. What normally happens in this situation? Will they take any monthly payments (obviously if it got accepted) and then take all the £540 as well once the house has sold? Is this something that would generally be in my favour because I could pay more a month once the house has sold and that I might get a few grand at the end of it?

I know I have written quite a lot here and would like to thank anyone who reads it and to anyone that gives some feedback, but most of all hope.

Thank you






Regards
Steve

[MelanieGiles]

Hi there and welcome to the forum

For every bad story you hear about an IVA, there are probably 100 other people who are quietly getting on with paying their payments with little fuss.

An IP cannot simply raise your payments without justification - so this could only happen if your circumstances improved sufficiently to mean that you could afford to pay more.

Your son is one of the most important things in your life, so of course it is important that you are left with sufficient petrol money to be able to visit him. A good IP will explain this to your creditors within the body of an IVA proposal.

You may be able to keep one specific source of credit to pay for your ongoing expenses (work related only) however this can only be done with the permission of your IP and the creditors generally - and importantly with that specific credit provider, and this would need to be cleared in full each month. I have occasionally done this quite successfully, so long as the justification is there.

You will need to address the equity in the property, and should take specific advice on this, as from what you have posted I cannot see any benefit in you continuing to pay your share of the mortgage. In the event that you were not to pay your contribution, this may spur your former partner into a quicker sale.

Do keep posting your queries and we will try to respond.

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

[kilohurtz]

Hi Melanie,

Thank you for taking the time to read my post and for your reply.

My IP advisor said that it didn’t seem right for me to continue to pay for the house especially after not living in it for over 20 months.

This does confuse me because now the house is on the market and by me not paying the mortgage it wouldn’t generate anymore interest than there has been. What I don’t want is for the house to get repossessed and sold for a silly price and I am left in an even bigger mess than I am already in.

I would simply prefer to stop paying for it after all I am getting nothing back and it is dead money that I am throwing away each month, also it’s because of this house that I am in this mess, well that and my naivety in trusting in someone.

I don’t know what really can be done I either continue to pay for this house indefinitely or pull the plug and face repossession and possible court action against me.



Regards
Steve

[MelanieGiles]

You will have to balance the upside of continuing to pay, against the downside of not. If you are paying half the mortgage, what incentive does your ex-partner have to co-operating towards an early sale. You may need to force her hand a little, in which case stopping the payments is not a bad idea - and creditors will not allow you to continue to make these under IVA proceedings.

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

[Helper and Seeker]

Hello Steve,

Good on you for getting up the courage to postas opn any forum it can be hard.

Never worry about the length of a post as we all like a good read[:D]

You will get alot of varied and helpful advice from the people on this forum each and everyone of them an expert in every aspect of debt.

My only advice would be to get as much of your finances sorted first.

You owe £44,000 well if you can juggle for a while longer then get as much of your finances sorted first eg the house sale etc and don't worry if the debt rises in the mean time.

At the end of the day it has waited this long and it can wait abit longer.

Others may tell me off for saying that but as I was in the juggling place you are at now, and was not faultering at all and also oweing several times more than you do and in just as much of a mess if not worse, I feel I have a right to say it as people will pressure you into acting sooner than you are ready to.

You have taken the first step by looking for a solution and when the time is right you will know what is best for you to do. It took me a few months to sort my situation out and I am 4 payments into my IVA now and although in many ways it was not the perfect solution it was the ONLY option and I thank God for it daily.

Ask whatever you need to as a wise person once said there is no such thing as a stupid question just a stupid person for not asking it.

Good luck x




Just started my IVA as from 12.10.07

[kilohurtz]

creditors will not allow you to continue to make these under IVA proceedings.

So what you’re saying is that I would not qualify for an IVA if I continue to pay for this house?

If I stop paying for the house the mortgage company will come after me for non payment, and possibly either reposes the house or sell the house at action for a silly amount leaving me with any outstanding debt. This to me seems like a serious lose lose situation. I try and do the right thing by possibly entering into an IVA but at the cost of stopping payment to my house with possible severe repercussions from the mortgage company?

Now I am totally confused and very worried.


Regards
Steve

[kilohurtz]

Good on you for getting up the courage to postas opn any forum it can be hard.

Thank you for your kind words and support.

I am in need of some serious good fortune



Regards
Steve

[MelanieGiles]

Steve

You said that there is approximately £30k of equity in this property? So it will be some time before any arrears erode that to turn into a shortfall. What are the agents doing about trying to find a quick sale - and is your ex-partner co-operating?

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

[MelanieGiles]

Steve

You said that there is approximately £30k of equity in this property? So it will be some time before any arrears erode that to turn into a shortfall. What are the agents doing about trying to find a quick sale - and is your ex-partner co-operating?

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

[mike.s]

Ohh Steve, I know things seem really bad now and you are going out of your head with worry, but try to take things one step at a time. It is easier said than done I know, but as bad as things seem right now it will get better! things will get sorted and you will get back on track and back to some sort of normality, there will be a solution for you and you will get through this! I am no expert by a long way, just a father and husband who has made some mistakes along the way and got into debt, I know how easy it is, so you are not alone! Your son is so important and you must focus on him and keep seeing him at all costs. Steve you say you are living off credit cards but haven't yet defaulted, I know what that means and how you feel, but all that is happening is you are getting further and further into debt, robbing peter to pay paul honestly isn't the answer and will only go on for so long. I am no expert as I say, but to continue paying out on the mortage seems pointless, I would address the problem now b4 it gets worse, but that is only my point of view. Speak to Melanie direct, you will get honest sound advice, and I promise you will feel much better (she really does know what she is talking about)
Steve not everyone in this life is bad, there are some good people out there who are not out to take advantage of you! You have found a great place full of wonderful people who will help you through this. There is plenty of help, advice and support here whenever you need it, along with a shoulder to cry on, or simply a rant and rave! We will be here for you mate, keep postin and get some pro help and advice, sooner rather than later, give Mel a call.
All the best matie
Mike

[lily]

Hi Steve

Just wanted you say hi. Youre not alone mate we have all been and felt the way you are right now. As someone else has said the hardest step is facing up to it all and trying to do sowmthing about it. I think the average person struggles on for around six months to a year living off credit until it finally hits them, I know I did.

An IVA us is individual, your own circumstances must be taken into account. I know there are some horror stories but if you take your time, particularly when choosing your IP and company, there will be some light at the end of the tunnel. I would advise that you speak to at least three companies and try Melanie above. The one most important thing is make an informed choice,mske sure all of your options are explained fully. What you need from your IVA (assuming you take this route) is very important. Funds to allow you to maintain contact with your son is as important to him as it is you.

I really hope that you will be feeling more positive soon.

good luck with everything.

lily

[kilohurtz]

You said that there is approximately £30k of equity in this property?

Hi Melanie,

There is 30k in the property but I have signed this away and cannot now legally touch it. Without doing this my ex would not have agreed to put the house on the market.

The equity that is in the property is about £12k which needs to be divided 50/50 and also after paying the solictors fees and estate agents fees.

I have recently asked the estate agents what more I can do and they told me the house is proced correct, its immaculate but the market is still very slow but is showing signs of it picking up.



Regards
Steve

[kilohurtz]

Your son is so important and you must focus on him and keep seeing him at all costs.

Hi Mike

Thank you for your comments and your kind support.

With regards to my son there is no way I could/would ever stop seeing him. I would rather go BR or give up totally if it was the only way to see him. I just hope there is an easier way, one the sorts out the debt but at the same time allows me to be the best dad I can.

Thanks again

Regards
Steve

[kilohurtz]

Just wanted you say hi. Youre not alone mate we have all been and felt the way you are right now. As someone else has said the hardest step is facing up to it all and trying to do sowmthing about it.

Hi Lily

Thank you for replying to my post. It does feel so much better knowing I am not alone. I have felt such a failure for so long. I would consider myself a very responsible guy, one that just made a few wrong decisions along the way. But it took a while to realise what I was doing and how I was living (robbing Peter to pay Paul) was wrong and it was only a matter of time before I realised this.

As soon as I did I sat back feeling sorry for myself for ages but one day I stood up walked tall and decided there has to be another way.

Time will tell..........

Thank you.


Regards
Steve

[mike.s]

Hi Steve,
Admitting you have a problem and facing up to it, is always the biggest and hardest step, and you have already taken that step, from now on it will get better! You sound like a really nice bloke and a good dad trying to do the right thing for everyone. You are not a failure one bit, you haven't let anyone down, just in a dark place at the moment that in time will get much lighter. We have all made mistakes, many of those mistakes are made simply trying to do your best for family and loved ones and give them the life you think they want. I've been there Steve, buying things for my kids trying to give them everything that their friends have etc, etc. But once you take your head out of the sand and get a little further down the track you soon realize that those material things are not important and your family is.Your son is the most important thing in your life and he loves you for who you are, a loving caring father! No matter what is going on hold your head up and stand tall, don't punish yourself for making some financial mistakes, who hasn't? hey look at the mess Northern Rock has got themselves into, glad I'm not them (except they have the government to bail them out) Hang on in there mate, there will be a solution for you and things will get easier from now on, speak to Melanie direct and see what her team can do for you. It will be one hell of a rollercoaster ride over the next couple of months, but hang on in there and you will get through this. Everyone on this forum is here for you whenever you need help, support or advice, or just for a chat when having a bad day! Keep posting Steve and good luck!
Best wishes
Mike