Is an IVA possible?!

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KlorBlok
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by KlorBlok » Thu Aug 24, 2017 10:26 am
Greetings,

I find myself with roughly £43000 worth of unsecured debt, £19k of this debt was due to gambling between March and July this year. I can't believe I got myself into this situation. Until about 2 years ago I was completely debt free except for the mortgage.

Zoopla estimates our house to be worth £200k but I believe it's wroth about £185k with a mortgage of £125k (joint with my partner). This gives us £60k equity.

I did an income and expenditure with a couple of IVA firms and I can afford to repay about £350-£400 a month but is this too low? Is it even worth considering an IVA?

Please advise, I'm stressing so much it's killing me!
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Foggy
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by Foggy » Thu Aug 24, 2017 11:33 am
The sort of repayment you are suggesting is actually quite a healthy one in an IVA. I owed around £65k (with the then wife) and we repaid just over £400 per month in the IVA. It is definitely worth considering an IVA.
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kallis3
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by kallis3 » Thu Aug 24, 2017 11:38 am
Hi,

Sounds feasible to me. Speak to a few companies and stick with one you feel comfortable with.
KlorBlok
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by KlorBlok » Thu Aug 24, 2017 12:00 pm
Thanks to you both.

£400 would be pushing it to be fair as my partner doesn't work and we have 3 kids under the age of 10. In an ideal world I would happily pay £350 for the next 5 years as I'm no stranger to living within budget (did it for many years without ever needing any form of credit).

After doing my research I have decided to go with McCambridge Duffy but their advice is to wait another couple of months before commencing with the process as I need to show 3 months worth of clean bank statements.

But when I do the numbers it doesn't seem like £350 would be acceptable to the creditors?

£350 X 72 (assuming we are unable to remortgage at the end of the 5th year) = £25200 and what about the IVA fees? I keep thinking that my biggest creditors (Tesco Bank and MBNA) would rather see my go bankrupt and take half the equity in the house which would be roughly £30k

am I missing something here?
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Foggy
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by Foggy » Thu Aug 24, 2017 12:23 pm
You have chosen a very good firm to go with and if they think it is feasible then it is. As I said, your dividend sounds good, even at £350. Tesco and MBNA were among my creditors and did not throw any spanners in the works.
KlorBlok
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by KlorBlok » Thu Aug 24, 2017 1:18 pm
Foggy wrote:
You have chosen a very good firm to go with and if they think it is feasible then it is. As I said, your dividend sounds good, even at £350. Tesco and MBNA were among my creditors and did not throw any spanners in the works.


Thanks for your kind words. I really hope that it works out.
Yes I do believe I have chosen a good firm for this journey. 5/6 years is a long time so I wanted to make sure I make the right choice from the outset.

I did do an initial I & E on the phone and I remember the payment was around the £350 mark but my concern is that my last few payslips show a significant amount of overtime payment as I was working on a project that has ended now). I wonder what they'll make of it when the come to request 3 month's worth of payslips. Not sure if Michael is around to assist with this query.
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Foggy
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by Foggy » Thu Aug 24, 2017 1:33 pm
KlorBlok wrote:
Foggy wrote:
You have chosen a very good firm to go with and if they think it is feasible then it is. As I said, your dividend sounds good, even at £350. Tesco and MBNA were among my creditors and did not throw any spanners in the works.


Thanks for your kind words. I really hope that it works out.
Yes I do believe I have chosen a good firm for this journey. 5/6 years is a long time so I wanted to make sure I make the right choice from the outset.

I did do an initial I & E on the phone and I remember the payment was around the £350 mark but my concern is that my last few payslips show a significant amount of overtime payment as I was working on a project that has ended now). I wonder what they'll make of it when the come to request 3 month's worth of payslips. Not sure if Michael is around to assist with this query.



I am sure he will be along to respond
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Michael Peoples
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by Michael Peoples » Fri Aug 25, 2017 9:13 am
Hi KlorBlok. I was out of the office yesterday so only seeing the posts now. Tesco often ask for statements to see where the money has gone if the debt itself is anyway recent. If gambling was a contributory factor to the problem they would certainly want to see that it has ceased so any online accounts etc should be cancelled if this has not already been done. It will certainly help get any proposal accepted.

The monthly surplus should be pretty constant regardless who you speak to as there are guidelines plus your individual expenditure. However some firms will try and use your wife/partner's income too but she has no obligation to do this.

I agree it is a good idea not to rush things especially if Tesco are more than 25% of the voting creditors and perhaps a temporary DMP would be appropriate while you get everything in order and show creditors that the gambling has ceased. If Tesco are less than 25% of the votes it could still be possible to get the IVA through but again I would think it better to wait and be confident going forward in a few months rather than risk a proposal now that could fail within a short period of time.

I hope this makes sense but by all means feel free to contact me directly if you want to have a chat.
KlorBlok
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by KlorBlok » Fri Aug 25, 2017 10:20 am
Michael Peoples wrote:
Hi KlorBlok. I was out of the office yesterday so only seeing the posts now. Tesco often ask for statements to see where the money has gone if the debt itself is anyway recent. If gambling was a contributory factor to the problem they would certainly want to see that it has ceased so any online accounts etc should be cancelled if this has not already been done. It will certainly help get any proposal accepted.

The monthly surplus should be pretty constant regardless who you speak to as there are guidelines plus your individual expenditure. However some firms will try and use your wife/partner's income too but she has no obligation to do this.

I agree it is a good idea not to rush things especially if Tesco are more than 25% of the voting creditors and perhaps a temporary DMP would be appropriate while you get everything in order and show creditors that the gambling has ceased. If Tesco are less than 25% of the votes it could still be possible to get the IVA through but again I would think it better to wait and be confident going forward in a few months rather than risk a proposal now that could fail within a short period of time.

I hope this makes sense but by all means feel free to contact me directly if you want to have a chat.


Hi Michael,

I appreciate your detailed reply. What's your contact number so we can have a chat on the phone?

Thanks in advance.
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kallis3
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by kallis3 » Fri Aug 25, 2017 10:44 am
Hi,

His details are in his profile if you check on that.
KlorBlok
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by KlorBlok » Fri Aug 25, 2017 11:17 am
kallis3 wrote:
Hi,

His details are in his profile if you check on that.


Ah! So contact McCambridge Duffy directly and ask to speak to Michael? Didn't know you can speak to an IP directly unless you're a client already?
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Michael Peoples
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by Michael Peoples » Fri Aug 25, 2017 11:43 am
It is always good to speak with an IP before you make any decision but unfortunately I am only an insolvency manager. I would however be happy to speak with you so click on my details and my contact details will be there. Alternatively ring the switchboard and ask for me telling them you are from the forum and you will be put through.

We have four IPs in the firm and they all speak with existing and prospective clients. Some firms make it impossible to ever speak with an IP which we think is wrong and in some firms I wonder if the IP exists!
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kallis3
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by kallis3 » Fri Aug 25, 2017 2:01 pm
As Michael says - he is not an IP but is very approachable.
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Lisa Thomas
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by Lisa Thomas » Tue Aug 29, 2017 1:48 pm
KlorBlok wrote:
Thanks to you both.

£400 would be pushing it to be fair as my partner doesn't work and we have 3 kids under the age of 10. In an ideal world I would happily pay £350 for the next 5 years as I'm no stranger to living within budget (did it for many years without ever needing any form of credit).

After doing my research I have decided to go with McCambridge Duffy but their advice is to wait another couple of months before commencing with the process as I need to show 3 months worth of clean bank statements.

But when I do the numbers it doesn't seem like £350 would be acceptable to the creditors?

£350 X 72 (assuming we are unable to remortgage at the end of the 5th year) = £25200 and what about the IVA fees? I keep thinking that my biggest creditors (Tesco Bank and MBNA) would rather see my go bankrupt and take half the equity in the house which would be roughly £30k

am I missing something here?


Yes the costs in Bankruptcy are high - there is a £6,000 Bankruptcy Tax to pay plus a shed load of costs on top plus any costs to repossess, secure, insure and sell the property, which can be avoided in an IVA.
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kallis3
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by kallis3 » Tue Aug 29, 2017 3:12 pm
I doubt anyone would make you BR - only HMRC are known to go down that route regularly,
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