On DMP but looking into IVA

[manc]

Hi

Have spent the most of today reading this forum and there is a lot of good info being passed on.

My wife and I are currently 10 months into a DMP with the CCCS and we pay £280 a month on £41k worth of debt (About 10 Creditors). Currently this will take us over 12 years to pay off [:0]

CCCS advised us that we would not be eligible for an IVA unless we could pay a minimum of 50p in the £, which is about £340 a month over 60 months.

After reading the forum today, I believe that they could have mis-informed us and not given an IVA as a feasible option.

BR is not an option as my wife would lose her job.

I am due a pay rise in January which will put us in a good position for an IVA, so I shall be making some enquiries in the next few weeks.

We don't currently have any equity in our house and have 4 years left on a fixed rate mortgage before it reverts to standard rate. Even if I end up paying an IVA over 6 years, it will be far better than the current CCCS DMP arrangement.

Is there a standard I&E form that is used for IVA's or is it the same as what the CCCS use for DMP's??

Many Thanks

It's all fun & games, until someone loses an eye!!

[Adam Davies]

Hi
Well the 50p dividend is clearly wrong info.
Can you list your debts and your disposible income ?
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

[aguise]

Hi there manc
You should list your I and E as it is, what you actually need, to live reasonably. Dont forget the little things like prescriptions, everyones needs are individual and vary so put what you use and need. If it is thought to be unreasonable your company will advise you, the same if it is not enough.
Ang

Please visit my blog at http://aguise.blogs.iva.co.uk/

[catullus]

Hello Manc

I'm an IP and, on the face of it, you are just at the lower end of getting an IVA approved but your payrise will certainly help.

The minimum return that creditors look for is 25% and many IVA 's get approved at this level if the creditors are satisfied that this really is your best offer.

Your problem is that at a level of £280 per month you would pay in £16800 over five years and the minimum amount that needs to be available for creditors, after costs, is £10250 leaving £6550 available for costs.

That should be sufficient to get an IVA approved, particularly since your wife has a very good reason for proposing an IVA. There isn't much room for slippage on these key figures and if any creditors are still charging or recommence charging interest it could put an IVA out of reach of you both for a while until your financial position improves.

That's a very good reason to look at an IVA now.Where CCCS got 50% from, I'm not sure but key questions for you are

1 Is the debt reasonably equally split between you both counting joint debts against you both separately

2 Who are your major creditors?

Each IP will approach the question of an I&E slightly differently but all will have an eye to the CCCS guidelines simply because that is what the major creditors tend to use.

Hope that helps a bit

[Andrew Graveson]

Hi manc,

Even as a provider of debt management services I'm clear that an IVA frequently (there are exceptions) offers a better debt solution where it is available.

Perhaps you might contact one of the highly recommended IP's that post on this site to discuss eligibility and suitability?

Goodness knows where CCCS got the 50p figure from.

Andrew Graveson
Mortgage Broker & Bright Oak Debt Management
andrew@brightoak.co.uk
www.brightoak.co.uk

[manc]

Thanks for the replies guys

The debt is mainly my wife's. I'd say £34k my wife and £7k mine.

The major creditors are Goldfish, Egg, GE Money and Mark & Spencers and the rest of the debt is split between about 7 other creditors.

The majority of them have stopped all charges and interest, but GE Money are constantly badgering us.

Our disposable income will rise to about £380-£400 early next year due to several changes in our circumstances. ie. less childcare costs

Thanks Again





It's all fun & games, until someone loses an eye!!

[catullus]

I'd say go for it, but some may counsel you against you personally entering in to a 5 year IVA for a debt of about £7k.

Frankly that's a very personal decision and also depends on what other options you consider that you might have.

In addition, be aware that you will be required to remortgage your home towards the end of the term of the IVA and although there may be no equity in it at the moment, who knows in 5 years time?

Your creditors look fine for a fair hearing so CCCS' 50% is even more baffling to me.

All the best

Catullus

[manc]

Would I not be able to get a joint IVA with my wife for the total amount of £41K?



===========================
It's all fun & games, until someone loses an eye!!

[catullus]

You need to understand that there's no such thing as a joint IVA. In law,both parties have separate IVA's bit they work jointly, hence the term.

As I said, I think that you have a very good chance of approval. but whichever way you look at it you would be going in to an IVA for personal debts of £7k, principally to help your wife. On her own, I doubt your wife would have enough income to propose an IVA, so yes you would have to do a joint IVA.

Personally I think that you should do it, but read my last post again and think through the issues that could affect your decision.

[MelanieGiles]

I would counsel against an IVA for anyone only owing £7k, even as part of a husband/wife partnership, but have discussed this with creditors recently and got a mixed bag reaction to be frank.

At the end of the day it is your choice, but also the choice of the IP who you wish to approach to act for you. If you do get knocked back once, there may be others prepared to take you on as a client.

What percentage of the total income do you and your wife earn?

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

[manc]

What percentage of the total income do you and your wife earn?

I earn about 70% of the total income.

===========================
It's all fun & games, until someone loses an eye!!

[manc]

After reading this thread again, I don't think it would be possible for me to get an IVA for the amount I owe.

I only have 2 creditors myself and an additional 1 which is joint with my wife.

My 2 are with Moorcroft Debt Recovery (Argos) and Egg Card. The joint debt is with GE Money.

What options do I have?

===========================
It's all fun & games, until someone loses an eye!!

[MelanieGiles]

An IVA is not appropriate for you. If you are earning 70% of the income - ie £280 per month, then you could pay your debts off in 25 months if creditors were to agree to stop charging you interest. Even if they do carry on charging interest, you would still pay out within the five year term, and the costs of proposing an IVA would not be justified.

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

[manc]

The £280 is the amount that is currently disposable to the both of us and this will increase to around £400 in January.

I have been trying to look at this from a different angle since my last post. If it was possible for me to borrow a lump sum (say £20k) from a family member, what are the chances of all of the creditors agreeing a 50% F&F payment?

If agreed, I would be able to pay the family member back at £400 a month for just over 4 years.

===========================
It's all fun & games, until someone loses an eye!!

[MelanieGiles]

If you could get that sort of money, I suggest that you use some to pay off your own creditors and the balance to do a full and final settlement based IVA for your wife.

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