www.iva.co.uk

Hi ive just had a creditors meeting today and my main creditor Northern Rock has accepted but on the condition it is extended to 72 months.... all others have agreed.... but my question to you is... should i accept or go for bankruptcy ?? i live in a housing association place and have no other assets.... apart from a work pension that has been running under 2 years! i have a car on HP that ends in 14 months....

Ive told IP im gonna think about it before i answer them..... i really want to buy a house in the future and could be saving a deposit once bankruptcy ends .... IVA payments would be £195 pm for 14 months and £300 pm after that as HP on car finishes....

Bankruptcy is certainly an attractive option but I am surprised that you were not made aware of N Rock's six year stance before the IVA was proposed. Financially, you would be better off as would most clients but the decision to petition would have to be yours.

You could say to your IP that you will not accept the extension as you have no property and if the modification is not removed then you will petition. N Rock may reconsider but if they do not at least you have tried.

I'm no expert, but from my own dealings with NR, the 6 year rule is pretty standard for them.

It certainly is with Together Mortgages but if the loan was a Ventura loan and had less than six years remaining it is possible to have the IVA finished after five years.

If Jock had less than five years left to pay on his loan I would certainly argue his case with N Rock if he is adamant that he would petition.

Hi
You will financially be better off if you declare bankruptcy, however you may lose your car.
Would be good to see a stance made against the six year extension that NR seem to favour.
What dividend was your IP proposing ?
Regards

You definately ought to have been warned of the likelihood of this requirement by Northern Rock - it is well known in the industry.

Which IP firm are representing you?

I would tell your IP that if northern rock wont budge you will go BR and they will get less,even if you lose your car,you would still be better off.

You really do have nothing to lose by insisting that NR accept 5 years!!!

I do wonder how much money NR lose by insisting on these modifications.

Surely it is better to accept part of the debt back, rather than none at all with bankruptcy, as a lot of the posters seem to go for if they have been turned down and have nothing to protect.

Hi guys

thanx for your answers

IP did advise NR would prob go for 6 years !! but now im having other thoughts....

The original dividend proposed for 5 year iva was 35p/£1.... im not sure what it would be with the extra year!

I know the word Bankrupt seems scary.... but is it really that bad ??? its off your file after 6 years ??

IP has called back and asked what my thoughts are.... i ask about... as my car will be 4 years old this year already, what happens when i need to get a new one as it would be 10 years old when IVA completes.... its not doing great at the moment and it looks like a cow !!! its black n white all over and i got it because it was cheap

I am told that less than 10% of people who NR reject at creditors meeting actually go bankrupt. With these statistics in mind, the lack of money is unlikely to bother them too much as it is probably made up by the extra money they can anticipate via the direct payment arrangements or DMP's that the remaining people actually go into.