IVA application placed on hold due to recent spending

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loudan
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by loudan » Fri Oct 20, 2017 12:17 pm
Hello,

Completely new and admittedly know very little about IVA's however I spoke to a company yesterday who assessed my financial situation and advised me that I met the criteria for a IVA.

I provided all required evidence to the company however received a phone call this morning stating that at this stage, due to the largest proportion of debt belonging to one particular catalogue and recent spending in July and early August, I've been told that they cannot process the IVA further until there has been nearer 6 months since last purchase so will be back in contact in January.

My question is, in the mean time, should I just offer my creditors token payments as I cannot afford to make full payments until January.

Any advice would be very much gratefully received.

Louise
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plasticdaft
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by plasticdaft » Fri Oct 20, 2017 12:36 pm
Not sure token payments will hold them off till January. I'd maybe try chatting to another IVA provider.

How much as a % of the whole debt was spent in july/august?

Paul
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Foggy
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by Foggy » Fri Oct 20, 2017 12:47 pm
I have seen this recently, where the creditor held sufficient voting power to stop the IVA going ahead and was not predisposed to saying yes to recent spenders. I agree with Paul in that you should have a chat with another firm. I am disappointed that the firm you are currently talking to did not offer any useful advice such as, maybe, an interim DMP.
loudan
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by loudan » Fri Oct 20, 2017 1:19 pm
Hi both,

Many thanks for your responses and advice.

One particular creditor is owed 3000 with spending in the last 6 months being 1000 of this amount.

It seems it may be in my best interest to set up a debt management plan as an interim measure until January.
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Foggy
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by Foggy » Fri Oct 20, 2017 1:22 pm
Might I ask what your total debt is ? With £3k being the holder of the largest proportion, depending upon the amount you are able to pay monthly, a DMP might actually be the better way to go.
loudan
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by loudan » Fri Oct 20, 2017 2:15 pm
I have around £8500 in debt not including my car which is on HP.

The debt amount is split by around 5 creditors in total.

I will start researching the DMP's to obtain a little more information.
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Foggy
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by Foggy » Fri Oct 20, 2017 2:40 pm
To be honest, with that level of debt I would seek a DMP. It is informal, so won't be recorded on your credit files or on the Insolvency Register.

Have a read here:

https://www.iva.co.uk/debt-management-plan

Whilst I wouldn't recomment the charity firms for an IVA, they are good for DMP's and have a good relationship with creditors when it comes to getting them to freeze interest. I wouls suggest a chat with Payplan or Stepchange.
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kallis3
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by kallis3 » Fri Oct 20, 2017 4:03 pm
I agree with Foggy - go for a DMP instead.
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MerlinL14
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by MerlinL14 » Fri Oct 20, 2017 5:06 pm
I also agree with the consensus that a DMP would be a far better option. £8500 is no small amount, but not substantial enough to warrant the full restrictions that an IVA would impose.
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