I started my IVA in April 2007 (with Debt Matters but now Pay Plan).
The only alternative to IVA that i was offerred was Bankruptcy. At the time i was happy to take an IVA as i was led to believe that this was the best option and i really didn't want to be bankrupt.
I have a fairly well paid job, but for 2 years (between jobs) i took a large pay cut (30%) which left me with the odd problem paying some bills (although i was never more then 1 month in arrears and always got back on top.
My debts totalled 27k ish and i was paying in total around 520 a month to the different creditors.
My Iva was reccommended at £457 but at the meeting the creditors wanted £507, which i was told by Debt matters i had to agree to or it would all fall through.
I now earn more than i did in 2007 and could have easily afforded the repayments of my original debts (albeit one would have taken me 6 years to pay off).
I think that coming to some sort of personal agreement with my creditors at the time would have suited me better and avoided the need for an IVA?
£507 a month over 5 years is £30420, which is more than what my debts totalled when it started.
Don't forget that part of that final figure includes the IP's fees.
If you had done a DMP, you would not have had the guarantee of interest freezing, or charges stopping, so could have paid back more anyway.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
Hi
As Jan has said you have had all interest and charges stopped for five years and no calls/letters.
Probably well worth the extra 3k that you will pay as 27k would generally cost you around £500 a month to service,whereas your IVA has cost £50 per month
Sounds a good deal
Regards
IVA £50 a month to service? what do you mean by that? I was paying £520 for my debts before IVA, £19k of my debt was for a loan, which would have been all paid off by September 2011 and a couple of credit cards and my overdraft. if i had continued as i was before the IVA, i would have perhaps missed the odd payment but would have had debts of around £4,000 when the loan finished in 2011 and with the £350 a month i would save from that i could pay that off in a year - debt free by Sept 2012 having paid everyone in full. with IVA, i'm debt free by April 2011 but have an IVA on my record plus my creditors receiving a much reduced settlement.
Considering i can expect to earn more in the coming years due to experience and professional qualifications i am about to obtain there is a strong chance that i could have been debt free before 2012 without an IVA. I know there are some if but's and maybe's but i think this should have been discussed with me.
I think Andy is referring to how much it will have cost you to pay the IP's for their work.
If you had carried on, and missed the odd payment, then your debt would have increased as interest and charges would still have been put on and your credit record would have reflected this.
Your record will be shot because of your IVA, but that is for 6 years from the date of approval and then it is removed.
A DMP would have been on your record for 6 years as well.
If you are going to be earning a lot more, then you can pay a lot more to your IVA and pay your debts in full.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
Hi
All options should have been discussed prior to the IVA.
The £520 you were paying towards your debts were covering mostly interest payments so you would not be paying very much off the capital.By going down the IVA route you have basically paid the total debt plus £50 per month.Far less than the interest that would have been charged.
A dmp would have been better for your creditors,but not very different for you
Regards
My main "gripe" if you like, is that i was told that having an IVA would not affect my job or getting a new job. My existing employers are great and very understanding but i was offered a very good job with HSBC at the end of last year, passed 3 interviews against stiff competition but after accepting the position which paid considerably more than i was earning at the time the offer was withdrawn following a credit check and them discovering i had an IVA.
Luckily by current role has developed and is very secure so moving jobs is not an issue, although i will have to think twice in the future.
Isn't this all rather with the benefit of hindsight? Andy is correct in that you should have been offered all options, but would you really have plumped for a DMP when an IVA (based on your circumtances at that time) would have been repaid earlier?
Nothing to stop you now terminating the IVA and commencing a DMP if you feel that this is a better way forward.
you are right, but had debt Matters offered be a DMP i think i would have considered it further, bearing in mind that i knew 18 months ago that my salary would be increasing. my reason for contacting them was to find out about the options and i didn't know what an IVA was until they suggested it.
Are you able to terminate an IVA after 18 months and how do i go about it and who do i speak to etc..? Are there any implications?
If you miss 3 payments, your IVA will fail and you will be back to where you were before. As the IVA has only been running for 18 months, the chances are that all your payments so far would have only paid the fees and not a great deal off your debts so you would have to pretty much write off what you have paid so far (or a big chunk of it)
Once the IVA fails and is terminated, you are then free to commence paying your creditors as you were before the IVA
I would speak to your IP, but i believe once you miss 3 payments to oyur IVA it will fail.
This will mean your creditors can chase you for the full amount again and start adding interest and charges to your accounts, but once it has failed you will be able to seek other options
You can terminate your IVA by informing your IP. As a party to the contract - perhaps the most important one! - you can exercise the right to break the contract, if you feel that it is no longer viable for you.
It would be most sensible for you to discuss this with your IP, to ensure that there are no hidden implications on you such as their obligation to petition for your bankruptcy in the event of default, but in practice if you move straight to a DMP with your creditors bankruptcy is pretty remote and would not be in anyone's interests.
