Am I in the correct debt management ?

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deco

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Post by deco » Tue Sep 14, 2010 3:38 pm
Am I in the correct Debt managment?

I stupidly got myself into debt 30K+ and have been in a debt managment plan for 9 months paying £200p/m. The DMP is in my own name, but I also pay a number of my wifes loans that we have + 2 car HP loans whice we need as we both travel distances to work. I have 3 young children and I feel that I'm not giving them or my wife the life they deserve as my money is tied up paying for my stupid mistakes.

We both need our cars as I travel 90mile in N.Ireland to work.

What would anyone advise?
 
 

kallis3

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Post by kallis3 » Tue Sep 14, 2010 3:47 pm
Hi and welcome to the forum.

Sounds as though your debt situation is a little complicated. I would suggest that you seek further advice.

Visit www.iva.com for a list of companies and reviews. Give one or two a ring and you will receive free and impartial advice as to all the options open to you.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley.
http://kallis3.blogs.iva.co.uk
 
 

Adam Davies

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Post by Adam Davies » Tue Sep 14, 2010 3:53 pm
Hi and welcome
Did the debt management company discuss other solutions with you ? bankruptcy or an IVA ?
Regards
Andam Davies
 
 

MelanieGiles

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Post by MelanieGiles » Tue Sep 14, 2010 8:08 pm
An IVA would sound like a mucn better solution for you if you want to continue to pay something back towards your creditors. The DMP will take you much longer to finalise than a five year IVA, and I suggest that you contact an insolvency practitoner operating in Northern Ireland to discuss your options further.
Regards, Melanie Giles, Insolvency Practitioner
 
 

deco

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Post by deco » Wed Sep 15, 2010 9:05 am
I do want to payback my debts or towards them as I believe that I got myself into the mess I should get myself out of it by repaying. The DMP was offered to me as I said that in 2years I had hoped to be able to increase my payments as some of the other loans would be cleared. At the time my thoughts on a IVA was that it was a milder version of being bankrupt hence staying clear of it.
 
 

Andrew Graveson

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Post by Andrew Graveson » Wed Sep 15, 2010 9:25 am
Hello deco,

Like bankruptcy, an IVA is a form of insolvency. There are obviously some downsides to that but these need to be weighed against the downsides of your existing debt management arrangement.

Assuming 15% charges for the management of the DMP, a £30k debt and that interest/charges are frozen, it would appear that a debt management plan might run for around 15 years.

How much will you expect to be able to increase your debt repayments by when your other arrangements come to an end?
Andrew Graveson
Bright Oak Ltd
UK Debt Management Company
Website: www.brightoak.co.uk
 
 

Tina Shortland

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Post by Tina Shortland » Wed Sep 15, 2010 9:44 am
Hi Deco - as the other experts suggest give 2 or 3 companies a call to dicuss your situation in more detail so you can see what your options are and work out your best way forward.

Regards,
Regards, Tina Shortland, Debt Advisory Manager for Melanie Giles at Debt Advice TV.

If you’re looking for effective debt related information, articles and news, then go now to our on-line advice service at www.debtadvicetv.com

If you’re ready to ask us for specific advice or help, then get in touch at www.call-me.debtadvicetv.com so you can start to free yourself from the stress and anxiety of overwhelming debt.
 
 

deco

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Post by deco » Wed Sep 15, 2010 9:49 am
I managed to get the managment fee to 10% and I hoped to increase it by another £200 pounds p/m after my wifes personal loans cleared. In theory I hope to in 3yrs time be back on track with the aim of clearing my debts as fast as possible without becoming bankrupt. Can a DMP run for that length of time without your home or anything being at risk? My debts were all unsecured loans and cards.
 
 

Andrew Graveson

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Post by Andrew Graveson » Wed Sep 15, 2010 9:58 am
A debt management plan doesn't provide legal protection deco. So technically the things you mention might be at risk (though legal action doesn't happen that often in reality where a fair and reasonable debt management plan is established).

At £400 per month, with 10% charges, a £30k debt and frozen interest/charges the DMP would be expected to last around 7 years.

Quite a difference though still a longer arrangement than would be normal in an IVA or bankruptcy.

Do you have equity in your home?
Andrew Graveson
Bright Oak Ltd
UK Debt Management Company
Website: www.brightoak.co.uk
 
 

liamjames

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Post by liamjames » Wed Sep 15, 2010 10:24 am
At £400 with a £40 management fee, you'll be looking at clearing those debts in 7 years, not including interest and charges (which I'd hope that the debt management company have negotiated for your creditors to freeze).

An IVA would typically last 5 years, but gives you far less flexibility. In this instance I'd suggest that there are lots of positives and negatives to each approach. Take some advice, phone a couple of IPs to weigh up your options.

Another thing to remember is that your creditors would have good reason to assume that if they reject the IVA, you will continue in a debt management plan and eventually pay them 100%. It doesn't sound like you are considering Bankruptcy, so getting them to agree to an IVA might be tricky.
Take care,

Liam James
Varden Nuttall
http://www.vardennuttall.co.uk

Read our reviews here: http://www.iva.com/iva_companies/Varden_Nuttall.asp
 
 

deco

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Post by deco » Wed Sep 15, 2010 11:13 am
The interest has been frozen so far, but I understand that under a DMP this can change at any given time.

I really just want to go the best approach to repaying my debts as they are down to my stupidity without my home or family being affected.

I dont think I have any equity on my house given the way house prices have fallen in N.Ireland.

Has anyone ever been on a DMP for my type level of debt and does it work?
 
 

Tina Shortland

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Post by Tina Shortland » Wed Sep 15, 2010 3:19 pm
Hi Deco - if you can have a legally binding arrangement to sort out your debts that would be better for you as you will have certainty and a fixed end point, together with the proctection against any changes the creditors would want to make. Once you are in an IVA there is flexibility if your circumstances change and it would be down to you having a good IP to work with you throughout the IVA term.

That said, it may be, all things considered you may look at bankruptcy being an option.

If you want to just get things sorted once and for all, the best thing you can do is pick up the phone and speak to some professionals to get specific advice.

Regards,
Regards, Tina Shortland, Debt Advisory Manager for Melanie Giles at Debt Advice TV.

If you’re looking for effective debt related information, articles and news, then go now to our on-line advice service at www.debtadvicetv.com

If you’re ready to ask us for specific advice or help, then get in touch at www.call-me.debtadvicetv.com so you can start to free yourself from the stress and anxiety of overwhelming debt.
 
 

deco

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Post by deco » Fri Sep 17, 2010 12:23 pm
Its so confusing what is teh best solution-- I really want to pay for my mistakes in a way that my home and family are safe. My current DMP is currently working with all interest and charges stopped. My current DMP company suggest I stick toi what I'm on and if I get to be in a position to increase my monthly payments then it gets better from then. They suggested that if my dmp starts to fail then look at IVA?

Would that be good or bad advice?

I have no equity and I def would not get any loans as my credit file is very poor I would guess result of missed payment etc...
 
 

Michael Peoples

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Post by Michael Peoples » Fri Sep 17, 2010 12:28 pm
If there is no equity your home is safe in bankruptcy and here in N Ireland income payments orders are quite rare.

However, if you enter an IVA or bankruptcy you would not be able to repay your wife's debts and unless she had sufficient income of her own to meet the payments, she would have to make some form of arrangement too. It would be worth taking some free advice from an IP firm to see if an IVA is the correct option and what the implications would be.
Michael Peoples | McCambridge Duffy Insolvency Practitioners
http://www.mccambridgeduffy.com
If you would like to talk to me about proposing an IVA or have any questions at all please visit www.mccambridgeduffy.com
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