am about to have my iva failed

[hb123]

Hi

I am about to have my iva failed as i have built up arrears owing to the fact i was never informed of my contribution as i had a reduction in wages. I have sent some 15 letters asking for my monthly contribution and lots of phone calls.

What can i do to get out of this mess - can i set up my own payment plan directly with creditors

what happens when my iva fails?? there is no stipulation that my supervisor will make me bankrupt

HELP !!

Thanks

[MelanieGiles]

Hi hb123 and welcome to the forum

The best way out for you is probably to arrange a DMP directly with your creditors. If you can then sustain payments for say a year under that scheme, it may be worth putting forward another IVA at that time if you feel that you can commit to an ongoing repayment programme. Also consider bankruptcy proceedings as an alternative, especially if you have no assets which would be affected.

[hb123]

Hi

Thanks for the reply - if my IVA does fail, is it likely that my Creditiors will try to make me bankrupt, or would they prefer to arrange a payment plan with me as I have little assets other than my house that has little or no equity in it??

Also I have written to my creditors,including a copy of every letter I have written to dfd. I also included an upto date income and expenditure sheet, and details of a pro rata offer to them based on this income and expenditure.

The figures i have qouted them, whislt realistic for myself, offer the same return to them as they would recieve from the iva (60p per pound) but is less for me as I am not paying dfd for a poor service.

However, although i sent the letter by recorded delivery to each of my creditors, I have receievd no reply at all - any idea why this is case - are they not permitted to contact me as my iva has not yet failed??

Also i spoke to the National Debt helpline, and they mentioned transferring the equity in my hpouse to my girlfriend - and said this could be done for a £1. Any ideas how this works??

Thanks

[Trickles]

Hi Hb123
Sorry I can't answer any of your questions as I am relatively new to this. But I am sure one of the experts will contact you shortley. I have found the experts to be very helpful and encouraging, so hang on in there! Trickles

[ianmillington]

A couple of points here:

The majority of your creditors won't communicate meaningfully with you unless and until they receive formal confirmation from the Supervisor that the IVA has terminated, as until then they remain bound by it.

Also, bear in mind that once the IVA terminates the creditors will be entitled to add interest and so your debts are likely to increase, perhaps significantly, depending upon how long it is since the IVA was approved.

You are somewhat unlikely to get all your creditors to write off a substantial proportion of your debt outside of a formal solution, such as an IVA or Bankruptcy.

Finally, the advice you attribute to the National Debtline. Before I comment on this, exactly what have they told you?

Ian

[hb123]

The National Debt helpline advised me there was a method that I can use where i can transfer any equity in my house to my girlfriends name, and as i have little equity in my house this can be done for a minimal fee.

With regards to the interest, what would you advise me to do? surely my creditors are better off agreeing a payment plan rather than making me bankrupt as i have little in the way of assetts / equity?? Is there any way i can start a new iva, or do i need to wait as Mel advised??

Thanks

[ianmillington]

The National Debtline "scheme" will apply if you are bankrupt and the Official Receiver sells the house to your girlfriend. If there is negative equity (which you will need to demonstrate to the satisfaction of the OR)she can buy it off the OR for £1 and legal costs of £211 (I think). Is the property jointly owned? If not, bear in mind that if she currently has no interest in the house she will have to get her own mortgage (as your mortgage holder will probably object to keeping you as the mortgagee when someone else is the owner). If you simply "transferred" the house to your girlfriend without properly demonstrating that there is negative equity whether or not she then pays the mortgage, your creditors could well perceive such a move to be a transaction at an undervalue which would be challenged in a bankruptcy if there ultimately turned out to be equity.

Assuming that Inland Revenue and HMRC aren't on your creditors list, it's highly unlikely that a creditor will make you bankrupt, so you would probably have to do it yourself.. I seriously think your best option is likely to be to consider attempting a second IVA, subject to you fitting the current acceptance criteria.

Ian