hi, i have been in a debt maanagement plan for a couple of years but my business had to close 2 months ago and i have not been able to keep up with the debt management plan, they have said they will lower my payments from £350 to £80 with my debts around £45000 unsecured, but will take forever to repay. they have said i cannot go down the iva route as im not working, but my wife is.
we have 2 buy to let properties which make us a small monthly profit but are both in negative equity and our home which had the shop in the front room is on a commercial mortgage but is also in negative equity. things have been made worse as well due to the tax credits office deciding they have paid us too much and have lowered our payments by £95 a week which we are hoping to get sorted as they are wrong. would we be able to go down the iva route and if so what would happen to our properties. thanks in advance for any advice
I'm not sure how you would stand to be honest as yours does seem to be a more complex case.
I would speak to a professional. Visit www.iva.com for a list of companies and reviews and give one or two a ring for free and impartial advice.
One of the experts may be on to advise later.
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
In order to advise whether an IVA is an appropriate solution for you it would be necessary to perform a full appraisal of yours and your wife's current financial situation.
To do one you'll need to be able to offer more than £80 per month over 5 years; nearer the £350pm mark. An assessment would need to be made of your joint disposable income.
Also, what's the prospect of you getting employment - this would have a material impact upon your financial circumstances and the possibiliy of you doing an IVA.
If your wife has debts then she may also need to consider a debt solution.
With regard to the properties, these need to be disclosed in any IVA proposals. If there is negative equity it may be possible to exclude them. Secured creditors can be invited to value the unsecured elelment of their claims and vote and receive dividends in the IVA.
How good is the covenant of your existing tenants? I ask this because, if there are periods when the properties are vacant and you don't receive rental income, this would probably result in you defaulting on your IVA through not being able to afford to pay monthly voluntary contributions.
There are many factors to consider that cannot be answered in one posting on a forum. However, I hope you find this helpful.
Regards
Andrew Bowers
Licensed Insolvency Practitoner
thanks for the welcome and replying.
i also have had a couple of my creditors take me to court already giving me ccj's with others threatening same. i have also been looking at bankruptcy. i just do not know what to do, we are totally depressed but i know its no good sticking my head in the sand any longer. we have 3 young children and have worked dammed hard for what we have and for this dammed recesion to destroy everything we have is killing me.
im 44 next and have had no response to any of the jobs ive applied for. seems the recesion is far from over in our area.
just hope we can sort something [:(]
Please visit the link provided and speak to one or two companies. The advice is free and impartial.
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
You don't need all the information to hand to start off with, the initial phone call will advise you as to whether or not it is the right way forward for you,
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
With debts of £45,000 - in my professional opinion - you ought to be qble to offer an IVA with disposable income as low as £200 or perhaps even lower - but at the end of the day the solution you choose will need to be based on what you can actually afford rather than forcing figures to fit.
You certainly don't necessarily need to be in current employment to put forward an IVA to creditors - I had one accepted this week for a lady whose payments are being entirely funded by her husband, and both of them were happy with the arrangement and creditors absolutely delighted.
If the investment properties are in your name, or are jointly owned, you may need to agree to selling them at the end of the IVA if they have appreciated in value by that time. If they remain in negative equity this will not be necessary. If the profit element is relatively modest, and you are paying the buy to let mortgages on an interest only basis, you will need to consider how you will deal with rising interest rates and whether any increase in mortgage payments could be passed on to your tenants.
And finally - if you gain employment during the IVA your monthly contributions will need to be reassessed and you could end up paying more - but only based on 50% of the actual increase. I would seek professional advice from a more flexible insolvency practioner than the one you have already spoken to.
thank you melanie, ive had some advice today and seems like there may be some light at the end of the tunnel.
so glad i found this wonderful website, many thanks to everyone
Glad you are getting sorted, keep us informed and of course the forum is here for any advice and support you may need.
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
