IVA and car help desperately needed

[georgie14]

hi

i would be grateful for some advice.

we currently have a car on Hire purchase however the payments are rather high £250 per month and as we are looking at IVA this would mean that financially we prob wouldnt qualify for IVA as SOA says we have 350 extra a month but if we included the car this would take down to £100

what i wondered is can we hand the car back and explain we are entering into an IVA and purchase a run around (i need a car for work as travel 100 miles a day) if we can do this what is the maximum that we can spend? my parents are kind enough to purchase this for us but i dont know what the limitations are with this and what we can spend?

thanks again x

[Tina Shortland]

Hi Georgie - what lovely parents you have! If they are using their money to buy a car for you then they can spend what they like but I would imagine you would want to get the balance between getting a reliable car and not using up too much of your parents funds.

If you do not specifically have to have the current car then it seems a sensible choice to look at ways of improving your DI for the creditors - stopping the HP means you won't have to cut back to potentially unmanageable levels elsewhere in your budget.

Keep us posted how you get on,

Regards,

[langerbridge]

Georgie if you do 100 miles a day that's at least 20,000 miles a year 100,000 over course of an IVA. A runaround wouldn't work! Could your parents fund the car payments for you? Also remember with that mileage your going to have extra maintenance to do. Servicing could be twice a year depending on make. Also if you have a modern diesel you could have a whole host of problems in years 4&5 with a newer diesel, just google dpf or Egr valve. Good luck!! I'm in a 6 year IVA starting year 2 with a 3 year old diesel astra. My mileage is 22k a year & my maintenance is over £50 a month - this includes service, mot, cambelt & waterpump change as well as tyres.

[Adam Davies]

Hi
How much unsecured debt do you have ?
Regards

[georgie14]

Hi everyone thank you for your feedback

i appreciate we are very fortunate to have our parents help but i dont want to take advantage and get a really expensive car but i also understand it needs to be reliable.

you made a good point about the mileage which i never thought is there a maximum as to what fuel i can put on SOA to get accepted i put in at least £200 a month which i know sounds excessive but its because my work is so far away.

our unsecured debt taking into consideration the shortfall on the mortgage will be around £70,000 going through CCCS it says we have £395 a month that we can pay into IVA also i wondered as my husband job is commission based he gets a basic and then quite a good commission but not guarenteed and can range from £1500 some months to none others how will this be viewed by the IP or creditiors? if they were to take this year as an example he has received a very good bonus but next year is looking tight can they set up your payments on commission?

thanks again we have not yet contacted IP have a few in mind through the advice of this forum that we are going to contact but we are going to do in jan as want to have a "normalish" xmas - sad i know but just want to not think about debt for once and trying to get as much things straight in my head first

[Tina Shortland]

Hi Georgie - there is no maximum as such on fuel - if it is over a certain limit you need to provide fuel receipts to show the level of expenditure and justifiy the amount of mileage you have to do.

When you speak to a few companies they will go over every detail of the expense budget to ensure you are not leaving yourself short on anything. Bonuses are not relied on as income - you can earn an extra 10% of the net income a month and the remainder is split 50/50 woth creditors so it gives you some excess and the creditors benefit too.

If last year was particulalry high you can explain that to your chosen IP.

I completely understand about wanting to have a normal(ish) christmas first but hopefully it won't be by having to rely on any more credit as you are maintaining payments to creditors. you may want to speak to a couple of companies now and you may be surprised by what is said - then you can decide if you want to proceed. I know some people want to get things sorted by Christmasso they can enjoy it knowing things are in hand and they have actual money in their pockets too but everyone is different and you need to do what is right for you when you are ready.

Regards,

[kat68]

hiya georgie,
i have to agree with langerbridge here re. a run a round car, given the amount of miles you do a run a round may be false economy, and may not see you through the next 5 years, before clapping out completley or at least requiring expensive repairs, which may leave you struggling.
£250 a month does seem a lot on car repayments, i have an almost new medium sized family car which was bought about 9 months pre iva for which my repayments are £150 per month, which i feel should last me the length of the iva,
could you possibly look into changing your car for a more reasonably priced one, which would still be fairly new and hopefully reliable, if you could reduce your repayments by about £100 pounds per month this would free up more disposable income to make an iva viable.