Worried

[johnd]

Just phoned and discussed IVA.
I am being sent documents to confirm what was discussed on the phone ref debts.

I have been advised to open another bank account, trannsfer all direct debits that must be still paid (morgage,secured loan,utility bills etc) and leave / cancel all my direct debits such as credit cards & loans that the IVA will hopefully be taking care of in my old bank account.

because i will probably have to wait 6 weeks or so until i find out if ive been aproved for IVA i am worried sick that in the meantime i will be chased for the direct debits i have canceled and if i am not aproved what will i do then?????

Also, i get charged an account fee and an overdraft protection fee in my current bank account and if i ask to cancel them while still being in my overdraft they will surely get suspitious?


i have such a head ache

[luluj]

Welcome.....what you have been advised to do is standard practise....it will allow you to build a small contingency fund before entering into your IVA formally. Creditors will be notified of the intent to set up an IVA and will know that payments will cease .... Your credit record will already be showing as poor so missing a couple of payments in reality will not impact it further.

Please ensure that when you receive the paperwork to sign that the income and expenditure suggested is a real time list of what your actual expenses are ....please do not agree to an unrealistic budget as you will need to be ale to live comfortably for the next five possibly six years.

If you are unsure as to the advice received today in any way it is always worth considering alternative companies and a good starting point is www.iva.com ... A comparison website that will direct you to some hiy recommended companies

Good luck and keep us posted with your progress.

[kallis3]

Excellent advice from Liz. Not many of us do pay prior to the IVA being accepted and it will make no difference to the voting.

You will get phone calls and letters but don't let them bully you into anything and send letters to your IP.

Make sure you are happy with the company that you choose.

Good luck and the forum is here at anytime to advise and give support.

[Shining]

Hi as Luluj says that is usual. Some posters do prefer to make a token pro-rata payment to their creditors but it's each to their own, I personally made none, yes they did call and write to me, but by not paying them it gave me a contingency fund to begin my IVA with.

Please don't worry about charges or interest added that will be included within the IVA.

Do check and double check all paperwork and it's always wise to speak to a couple of companies and the above link is a good starting point if you wanted to do this.

A good IP will only put forwrd a proposal that is acceptable. It is a worrying time and we have been there honest...please keep posting for advice/support as you require, we're all with you x

[kazzafunk]

Johnd - welcome.

As the others have said above it is a worrying time. We made no payments for 3 months prior to our IVA being approved. We had calls and letters, however I unplugged the home phone, changed my mobile number and just piled up the letters to send to my IP once a week.
We opened a co-op cashminder account and switched our wages very quickly. Our bank (HSBC) loaded us with charges by paying out direct debits then recalling them so by the time we entered the IVA our overdraft had jumped from £1,500 to nearly £3,000 but it's irrelevant once the IVA is approved.

It seems it will never end but all the stress goes away when the IVA is approved. Stick around on the forum and we will help you through the coming weeks.

[kev59]

as other have said, most of us stop all payments to companys that are going into the iva.
make sure the new bank has nothing to do with any of your debts.
getting the paper work together looks harder then it is.

[kallis3]

As regards the bank, Co-op come highly recommended on here as long as they're not a creditor.

[johnd]

Thanks for the responses

The main worry is that once I cancel the direct debits and they start chasing payments and charge me penalties, if I'm not approved I am lumbered with even more debt which I can't pay.

I'm sure it will be fine after reading the forum comments and the guy I have talked to on the phone in ref to IVA (Andy Davie from Vincent Bond) seems very helpfull - and I'm sure will expect a few phone calls from me with further questions I'm insure of lol

Has anyone else used this company, and if so do you think it's the right choice?

[johnd]

Oh, and yes I have applied for a co op bank account which they say I have been accepted for but won't rest untill I receive documentation in 7-10 days along with a debit card

[kallis3]

That's good news about the bank John.

I am sure your application will be ok - an IP won't put it forward unless they are sure of success.

Andy is a well respected debt expert who will make sure you are ok.

[johnd]

So I shouldn't cancel my direct debits until my application is put forward?

Also (sorry about sounding a thicky) what's an IP lol

[Foggy]

Hi John ..... IP = Insolvency Practicioner = the person who will supervise your IVA.

As for DD's. I cancelled mine as soon as I decided to "goIVA". It gave me a chance to get together a little emergency fund, before everything was tied down (financially speaking). If the IVA didn't get approved you might need to go into a debt management plan whilst working out the next move.

[johnd]

Thanks.

[kallis3]

Cancel your direct debits now so you can build up a bit of a contingency fund.

[johnd]

I take it that as I don't have a direct debit for my credit cards (they send me pay in slips, I just don't pay and wait for the letters to come in which I then pass on?