Posted: Fri Mar 30, 2007 6:19 pm
Hi,
Its great to find a forum for discussing IVAs with the experts and those people experiencing an IVA in some capacity. The information and advice floating around the forum is superb and it is relieving to hear that my partner and I are not alone. I sympathesise with many of the cases I’ve read on the forum and really hope it turns out well for them.
My partner and I are currently considering entering into an IVA with PayPlan - we have a total of £113k unsecured debt accumulated over the years (mixture of joint and individual). Although we have a relatively modest monthly income (total approx 4.3k) our outgoings have hit an all time high with priority debts (excl. arrears) at about 3k per month and unsecured debt at 2k per month. We are not behind on any loan/credit card payments....yet! We have been struggling to eat for the past 3 months now and this month will be the first time we will be unable to make the full contractual monthly repayments to our creditors. I’ve just written to most of our creditors explaining the situation (outgoings greater than income and seeking solution with the help of PayPlan) and offering token payments of £5 for current month and that I’ll be in touch with an update within four weeks.
For those creditors who we have a functioning account with we’ve paid them the full amount so that they don’t close us down….just in the process of opening a ‘parachute’ account. After completing numerous income/expenditure configurations, we are working out a configuration with PayPlan that will be suitable for an IVA over 5 years.
We haven’t agreed to go through with the process yet - we have so many questions(...many of which have probably been answered by the superb experts on this forum). For example:
1. my salary will probably go down by £250 a month in Sep, some credits/costs would rise/fall during the course of a five year iva (child benefit, child care, utility bills). Does one have to project worst case scenario over the 5 year period?
2. During the period of an IVA, how often do creditors want a report on finances and what type of evidence do they require? i.e. how close are they watching how we use our account?
3. What if we cant get a remortgage in the fourth year due to the IVA (or are there always a lender to help out IVAers)?
4. If we can get a remortgage, does the IVA take into account the increased mortgage repayments?
5. If the IVA fails, is it definite bankruptcy or can one go onto debt management for the outstanding amount?
6. Do the voting agents for creditors use clear and common criteria when voting or is it simply down to creditor-specific guidelines and the 'human aspect' (personality of individuals involved at that time).
7. What level of influence do we have during negotiations for an IVA? For example, could we refuse specific demands of an individual creditor e.g. creditors want 60% of an additional income during period whereas we argue to give them 40% etc
Although we’ve considered numerous options, the IVA seems to be the most suitable to get us out of debt faster and repair credit record....although cant help thinking it's more in the creditors interest than ours and it appears high risk (fragile agreements and you end up going bankrupt anyway!). I dont like the idea of debt management as they're informal, potentially go on for years and your credit record is affected for 6 years after the plan has ended.
Anyway, given my details at end of message any advice regarding the IVA or alternative solutions warmly welcomed (e.g. consolidation loans, remortgage, settle with equity).
Best
OW
Income and Expenditure
Total Income £ 4,408.30
Total Expenditure (Priority Debt) £ 3,259.86
Total Surplus Income: £ 1,148.44
Equity: 38,076.00
Current unsecured debt: £112,050.00 (across 17 creditors)
Its great to find a forum for discussing IVAs with the experts and those people experiencing an IVA in some capacity. The information and advice floating around the forum is superb and it is relieving to hear that my partner and I are not alone. I sympathesise with many of the cases I’ve read on the forum and really hope it turns out well for them.
My partner and I are currently considering entering into an IVA with PayPlan - we have a total of £113k unsecured debt accumulated over the years (mixture of joint and individual). Although we have a relatively modest monthly income (total approx 4.3k) our outgoings have hit an all time high with priority debts (excl. arrears) at about 3k per month and unsecured debt at 2k per month. We are not behind on any loan/credit card payments....yet! We have been struggling to eat for the past 3 months now and this month will be the first time we will be unable to make the full contractual monthly repayments to our creditors. I’ve just written to most of our creditors explaining the situation (outgoings greater than income and seeking solution with the help of PayPlan) and offering token payments of £5 for current month and that I’ll be in touch with an update within four weeks.
For those creditors who we have a functioning account with we’ve paid them the full amount so that they don’t close us down….just in the process of opening a ‘parachute’ account. After completing numerous income/expenditure configurations, we are working out a configuration with PayPlan that will be suitable for an IVA over 5 years.
We haven’t agreed to go through with the process yet - we have so many questions(...many of which have probably been answered by the superb experts on this forum). For example:
1. my salary will probably go down by £250 a month in Sep, some credits/costs would rise/fall during the course of a five year iva (child benefit, child care, utility bills). Does one have to project worst case scenario over the 5 year period?
2. During the period of an IVA, how often do creditors want a report on finances and what type of evidence do they require? i.e. how close are they watching how we use our account?
3. What if we cant get a remortgage in the fourth year due to the IVA (or are there always a lender to help out IVAers)?
4. If we can get a remortgage, does the IVA take into account the increased mortgage repayments?
5. If the IVA fails, is it definite bankruptcy or can one go onto debt management for the outstanding amount?
6. Do the voting agents for creditors use clear and common criteria when voting or is it simply down to creditor-specific guidelines and the 'human aspect' (personality of individuals involved at that time).
7. What level of influence do we have during negotiations for an IVA? For example, could we refuse specific demands of an individual creditor e.g. creditors want 60% of an additional income during period whereas we argue to give them 40% etc
Although we’ve considered numerous options, the IVA seems to be the most suitable to get us out of debt faster and repair credit record....although cant help thinking it's more in the creditors interest than ours and it appears high risk (fragile agreements and you end up going bankrupt anyway!). I dont like the idea of debt management as they're informal, potentially go on for years and your credit record is affected for 6 years after the plan has ended.
Anyway, given my details at end of message any advice regarding the IVA or alternative solutions warmly welcomed (e.g. consolidation loans, remortgage, settle with equity).
Best
OW
Income and Expenditure
Total Income £ 4,408.30
Total Expenditure (Priority Debt) £ 3,259.86
Total Surplus Income: £ 1,148.44
Equity: 38,076.00
Current unsecured debt: £112,050.00 (across 17 creditors)