www.iva.co.uk

Our CCCS DMP started this month and so far so good, however HSBC have written to me to say they will accept the reduced payment proposed but only if we consolidate our 3 debts into a managed loan with a low 8%APR rate. I thought this sounded sensible as it would preserve my credit rating with HSBC at least but the CCCS advisor says don't do it. They say I should stick to the DMP route as I have other creditors and ultimately their route will lead to a faster clearance of the debts over time.

Any advice on this please?

I am pretty sure managed loans are bad news. They take a really long time to pay off and the interest is not great. Your credit rating will be shot also, I think.

Once you have recognised that you are insolvent - ie unable to pay your minimum contractual repayments on the due times without resorting to further borrowings, then you have to treat all of your creditors equally. If the managed loan would take a larger percentage of the monies available for other creditors, then you have been well advised to steer clear.

They tried to do with us as well - even sent the papers to us for signing, thanking us for applying!

We didn't bother.

As Melanie and CCCS have said - you have other creditors and you have to be fair to all of them.

HSBC are possibly trying to get themselves into a preferred position and since you are probably insolvent that could lead to your other creditor's being wrongly dealt with. Stay as you are - However I would like to see the letter that HSBC sent to you suggesting this - can you send it to me?

They processed this and did a search on our file without asking and the papers dropped through the door ready to sign! They were not asking for more than what CCCS were offering as part of the DMP so would not have benefited financially although they would be out of the DMP loop i suppose. I will reject it, thanks for all the advice.

David, have you an email address and I'll send you a copy,

Go to my Avatar and find my firms address that way as I am not allowed to publicise it on the forum.

David these letters are common - and generally sent out by HSBC as soon as they are notified of a potential IVA. There must be lots of these in your office already!

My husband had one of those letters and two telephone calls -£50,000 they offered £25,000 to my husband and £25,000 to me and I do not work! They were upset when the loans were refused. J

Same here.

Ours was offered whilst we were in a DMP - by the time we were ready to do an IVA they had sold the debt on.

Jan, what happens if an IVA debt is sold on - do we have to start all over again? Hope not. J

No, don't worry about that. Most companies sell them on. It makes no difference to you at all. All that will happen is that at the end of the IVA the dividend will be paid to the new company.

For example, my Barclaycard debt is now owned by Max Recovery/Eversheds and the HSBC debts were sold on to a company called Robinson Way.

Thank you - relief to know that. J

Hi, sorry barge in! What is a managed loan?

It's basically a loan offered by your bank to consolidate the money you owe them into one payment. It's usually over a longer period and, in my case, the payments were more than I had been paying before!

It's usually HSBC who offer them when you are doing a debt solution. Just refuse to do one if you are ever offered one.