should we consider an iva as we are struggling

[j.c.c]

we have other 50000 in debt, 41000 with one bank in unsecured loan and do not own our own home. our monthly income is 2800, should we consider an iva as we are strugling.

also i have a car on finance and is wortha bout £8000 and i have about £6000 on finance if i went through with an iva what would be the effects i.e would i have to sell the car?

[MelanieGiles]

Hi jcc and welcome to the forum

Normally I would say that this is a possibility for someone with the level of debt you have, however with such a substantial percentage with just one creditor I feel it would be better to negotiate a settlement, or a basis for ongoing payments, with them directly. Who is the bank?

As you are probably aware, to get an IVA accepted you need to achieve a 75% majority of voters at the creditors meeting. This creditor holds 82% of the votes so will have the decision to say yes or no. Best they be consulted first before any decisions are taken.

Your car will probably be safe under either option, but make sure you maintain the HP payments.

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

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[j.c.c]

Hi, thanks for your reply. We tried to put our payments on hold with the bank for 6 months as i was unemployed, but they said no, we also asked if they had any other options for us and they did not come back with anything, as our payments are £507 a month and the interest is £368, they do not have anything to offer us. We went into arrears with them for 4 months but will have those payments added to the next 6 months. The bank is hsbc. What kind of settlement would you suggest as they do not seem to be open to a lot and how would we go about discussing an iva with them?. Any advice would be great. Thanks.

[MelanieGiles]

HSBC have a high dividend criteria under IVA proceedings in that they expect to have a minimum return of 40% against their borrowings. They are represented by a firm called The Insolvency Exchange, who are based in Nottingham and deal with all of their debt collection work.

As I said to you earlier, I do not feel that an IVA will be acceptable to the bank, but it is worth a try if you can find someone to speak to.

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

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[Adam Davies]

Hi j.c.c
How much disposible income do you have ? [Income less rent,bills,food,clothes,travel costs etc etc but not including unsecured debt payments]
Regards

Andy Davie
IVA.co.uk Spokesperson and site manager
(aka Neverending)

Please check out my blog: http://andydavie.blogs.iva.co.uk

View my profile here:
http://www.iva.co.uk/andy_davie_profile.asp

[j.c.c]

Hi, If i was in work full time then it would be about £800 when we are both earning, but the problem is i am doing supply teaching so my wages are never the same and obviously with school holidays i earn a lot less. we also seem to be playing catch up at the moment so our disposible income does not seem to exist at the moment and i have only just started earning by 3 weeks work so are still greatly behind. If an IVA is not right for us can you suggest anything else to help, someone suggested trying to lend some money off family (not sure if we could) and offer hsbc a lump sum to pay it off.

[MelanieGiles]

Well HSBC's minimum dividend criteria is 40% under IVA proceedings, so that might be a good starting point. Negoriate with the bank directly to see what they might be prepared to accept. How much do you think your family could raise for you?

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

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk