www.iva.co.uk

Hi there, where do I start!
I have debts of 37k and was made unemployed recently which made things much worse because although i had struggled to make payments before that, I suddenly just did not have the money to do it. I was advised to pay my 6 creditors a monthly sum of £5 which I have done for the past 3 months. They have never been off my back to the extent of recieving up tp 8 phone calls a day. I have now changed my phone number because I just could not bear to be in the house anymore listening to the phone constantly ring and explain my circumstances repeatedly. I have just started work this month and have enlisted a company called clearstart to negoitiate an IVA for me. I do feel a little confused because I'm still not convinced it is the right road to go down. I have five young children and a husband who stays at home to look after them whilst I work to support. I feel that the budget that has been set out for me is not realistic because it does not leave much over for birthdays, christmas,kids shoes etc.
I am wondering if I'd be better off going bankcrupt. My main concerns about this is that the debts are in my name and the mortgage is in joint names with my husband. We have equity of about 15k, so what will happen to our home. The thought of being homeless with 5 kids under9 is really scary.
Also ive read that they can take your pension from you. I have an employers pension I have payed into for 17 years now and although its likely to be another 28 years before I retire I was wondering if thay can get a percentage of that.
I have also read that you can be made by the court to pay a percentage of your wages to your creditors after your bk. This could mean you are in the same position as having an IVA around your neck?
What shall I do? I feel that all this is ruining my life and that of my family and I'm to scared to discuss it with my family as they will be so disappointed in me for getting into this situation in the first place [:0]

Thanks Jx

Hi guiness

My first concern is your comment that your budget "has been set out for you". Your calculation of disposable income should be based upon what you actually earn and spend each month and not what someone says you are allowed to. That will not work in the long run, and you will fall into the trap of accepting an unaffordable IVA which so many people have found themselves in. Go with your gut feeling - if you don't feel that you will be able to afford the payments, then you will not in reality!

Bankruptcy may well be a better option for you. As you have equity in your property, your husband will need to find a way of acquiring your share by either borrowing money in his own right or finding friends or family to help. He will have up to one year to raise the money, and I would have thought a figure of around £5,000 would be acceptable.

Your pension is safe in either insolvency scenario, so worry no more about that.

With five small children, your budget at the best of times is going to be tight, and expenditure in an IVA does not really allow for birthdays and Christmases - just general household and personal expenditure. You will have to weigh up if it worth scrimping and saving during your children's most formative years, to try and repay your creditors.

It is correct that you may be required to make monthly payments in bankruptcy, but these are generally set at a lower percentage of your disposable income. I am sure Skippy will be along with her infamous payment table shortly - and also to give you some practical advice about her experiences in both an IVA and bankruptcy.

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

Blame Debt Dummy for the payment table Melanie - I didn't know it existed before she posted it on the Bankruptcy site! If you have £100 or less disposable income you will not pay an IPA, and it increases on a sliding scale and the most you will ever pay is 70%.

Guiness, I have to pay into an IPA, but I am paying £186 now as opposed to £459 in an IVA. The allowances in an IPA are much more generous than in an IVA - you can claim for birthdays and holidays as well as your day to day expenditure. I have posted my allowances in my blog, but please bear in mind that I have no children so my expenditure will be quite a lot different to yours.

Yesterday is history, tomorrow is a mystery, today is the present - a gift to make the most of.

View my blog at http://skippy13.blogs.iva.co.uk/

Admin

Is there any way Skippy's bankruptcy table** could be put on the site as a permanent feature. It just keeps cropping up, and would be useful to be able to refer to rather than her having to keep posting it into every thread.

I must stay I am finding it very useful, and use it now when preparing my own clients proposals.

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

great idea, table now posted http://www.iva.co.uk/forum/topic.asp?TOPIC_ID=3282 on new thread in bankruptcy section.
cheers admin

Thanks guys. I am definately think bk would be the best option. But who can I go to for good advice? a solicitor? citizens advice?
How does my partner go about buying my equity? Do i have to tell my employer?
Jx

Hi guiness

You can get bankruptcy advice from most reputable debt management companies, and CCCS and the CAB are also very good.

Your partner can make an offer to purchase your equity directly to the Official Receiver once he has been appointed Trustee.

Unless there is something in your contract of employment which provides otherwise, you do not have to tell your employers.

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

thanks for your prompt reply melanie. I am going to give it some thought.
Jx

http://www.debthelpuk.co.uk/law/adminis ... iceact.htm

and you may wnat to mention this to the next creditor who phones harrassing you:

The Administration of Justice Act 1970.

Section 40 of the act provides that a person commits an offence if, with the object of coercing another person to pay money claimed from the other as a debt due under contract, he or she:

(a) harasses the other with demands for payment which by their frequency, or the manner or occasion of their making, or any accompanying threat or publicity are calculated to subject him or his family or household to alarm, distress or humiliation;
(b) falsely represents, in relation to the money claimed, that criminal proceedings lie for failure to pay it;
(c) falsely represent themselves to be authorised in some official capacity to claim or enforce payment;
(d) utters a document falsely represented by him to have some official character or purporting to have some official character which he knows it has not.

Paragraph (a) above does not apply to anything done by a person which is reasonable (and otherwise legal) for the purpose of :

(1) of securing the discharge of an obligation due, or believed by him to be due, to himself or to persons for whom he acts, or protecting himself or them from future loss; or
(2) of the enforcement of any liability by legal process.

It is also provided that a person may be guilty of an offence under paragraph (a) above if he concerts with others in the taking of such action as is described in that paragraph, notwithstanding that his own course of conduct does not by itself amount to harassment.

lol, yes I did post the IPA table initially on the bankruptcy site.
Admin please place it here on this site to save Skippy from posting it routinely. **


Take care

All I have left is my humour.

View my blog http://www.debtdummybankruwoman.blogs.iva.co.uk.

**http://www.iva.co.uk/forum/topic.asp?TOPIC_ID=3282 new thread in bankruptcy section on this forum

thank you for posting that Dominic. Very good information.

All I have left is my humour.

View my blog http://www.debtdummybankruwoman.blogs.iva.co.uk.