please help and advice

[lmg]

hi,

i have the following debts
mbna 3900
barclays 4600
egg card 1000
egg loan 11000
halifax 2000
barclays od 1500
B&Q store card 1500

and other store cards with nil balance

I also have two hire purchase loans for 5500 and 3500 for car

payment for this is 270 and 170

my income is 600 and the household income is 3400 including the child benifit and tax credit.

based on my income and expenditure and i can afford £250

my husband faced the similar debt problem and has completed the IVA by remortgaging the property and selling his other property

The current property is joint one and he has the share of 75% and i have 25%

already we have taken 75% ltv by remortgaging and the current payment is 1550

my current monthly payments goes beyond 750 for the above credit and additionally i am paying 430 for the car loan (
HP)

I am now struggling and what would be the suitable option

please please advice

Thanks

[MelanieGiles]

Hi lmg and welcome to the forum

You have various options available to you - including bankruptcy, IVA or DMP. If you can afford to pay £250 per month, and do not wish to declare yourself bankrupt, then either an IVA or DMP would be suitable - the only real difference being that in an IVA you pay for a set period and have the benefit of legal protection, which is not afforded under a DMP.

If you have equity in your current property, which you suggest, you will be expected to look contribute from this under an IVA during the final year.

The decision as to which is the most appropriate route for you can be complex, and is better discussed directly with an insolvency practitioner who can give you specific advice as to each option and the advantages, disadvantages and implications of each one. Advice is generally given completely free of charge, and if your husband is already in an IVA it might be sensible to approach his IP if he has a good relationship with him/her.

[lmg]

my husband has already completed his iva and he holds 75% share in the property

this property was bought on his name and recent he has included mine with 25% share and maximum LTV is already taken with the mortgage

please let me know which one is better DMP or IVA

[MelanieGiles]

I can't confirm that for you, as you are the only one who can decide what is best. Some differences to consider are as follows:-

1 An IVA lasts for a set time period - usually five years - whereas a DMP will continue until the debts are paid off in full. This can be considerably longer.

2 Interest is legally stopped under IVA proceedings, but may continue to be charged under the DMP.

3 There is no legal protection against the actions of creditors under a DMP, which can be dangerous for a property owner as this could lead to charging orders being served which will turn an unsecured debt into a secured debt.

4 The DMP may not include raising equity in your property, whereas this is very likely under an IVA.

Both options will affect your credit rating, and defaults will be registered against you for a maximum six year period. As a rule of thumb, most DMPs do not last more than two years before they are either settled, fail or people enter an IVA as this is a more secure and certain route.

[Reviva UK]

Hi lmg

welcome to the forum

Following on from what Melanie said - it is often very difficult to go through the whole debt solution and consequence for you on the forum. This is because in a conversation other factors usually come out and would influence a recomendation.

I was able to meet Melanie last week and was particularly impressed by the set up she has and can only suggest you make time over the next couple of days and give her a call and se what she says - it is without obligation.

You would then be in the position of knowing all your options and could then choose the service provider you want to work with for an IVA, DMO etc.

Good luck - make the call

[lmg]

is it better to go for the DMP and then apply for a IVA once approved.

is it too early to think about either since i have not missed any payments so far. i have been getting help from relatives and cant go on like this for ever

[lmg]

has any one had different ratio of equity share with a mortgage who have entered an IVA.

My equity share is my husband holds 75% and mine is 25%

What will ne expected equity release if i entered an IVA

please help

[Adam Davies]

Hi
On these ratios you would have to release 25% of the equity[85% of house value less mortgage outstanding]
Regards

[lmg]

sorry andy i think i have not made my self clear

We have a shared equity scheme registered

75% own by my husband
25 own by me

Already we have taken 75% of LTV

do i need to release from the my share of 25% of the available equity

[MelanieGiles]

If I understand you correctly you own 25% of the equity and your husband 25%. So if your property is worth £200k and there is a mortgage of say £150k, you would own £12,500 of the equity?

Please confirm this is right before we advise you further, and also are both you and your husband insolvent?

[lmg]

yes that's right husband 75%

I am worried to enter the DMP since they can still take me to court and thats why i would prefer an IVA instead

my house price is 300000 and the 226000 loan outstanding

is there a alternative plan

i can pay mothly 200 and then release my equity share in an year some thing like one year IVA

please suggest

[MelanieGiles]

So you have equity of £18.5k - is this correct?

If your husband would agree to a remortgage now, you could almost afford to pay off your debts in full, and the £200 could then be used to service the mortgage.

[lmg]

sure, we recently remortgaged and in 2nd month of 2 year tied in mortgage

can we make the monthly payments of £200 and then release the equity by end of november 2009 by which we are out of the tie in period

may be looking for a 2 year iva with a lump sum at the end?

[lmg]

or even a one year iva with 200 a month and release the equity with a lump sum secured loan payment. please advice many thanks

[MelanieGiles]

You are more likely to be asked to pay for five years and then effect an equity release during the final year.