IVA minimum payment hikes

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Post by IVA News » Tue Nov 13, 2007 12:13 pm
IVA minimum payment hikes

BANKS are blocking debt-saddled consumers’ attempts to get back on their feet — by hiking up Individual Voluntary Arrangement minimum repayment terms.

Lenders such as HSBC, Halifax, Bank of Scotland, First Direct, M&S Money, NatWest, Abbey and Royal Bank of Scotland became disgruntled with the industry standard of 25 per cent of the debt. Many now demand 40 per cent — or it’s no deal.

Official figures from the Insolvency Service show banks have already tightened the screws.

There were 10,239 IVAs in the third quarter of 2007, down 4.3 per cent on the previous quarter and by 14.3 per cent on the corresponding quarter of 2006.

This method of debt management peaked in the last quarter of 2006 at 12,645 IVAs.

But now, with the tougher repayment terms, many debtors are giving up the halfway house of an IVA and caving in to the last resort of bankruptcy, say IVA comparison website IVA.com.

Stigma

IVA.com director Terry Balfour says: “We have seen the likes of HSBC and Northern Rock demand that borrowers settle an often unmanageable 40 per cent of their debt before green-lighting them for IVA solutions.

“Our concern is that many other creditors will now follow suit, forcing more and more people into the stigma of bankruptcy.

“Working up the courage to apply for an IVA is a big step. It provides a huge relief for people desperate to start again without the stigma of bankruptcy — not to mention losing their house and the pasting their credit rating will take.”

Britain has a growing £1trillion debt mountain and Debt Mediation Services, who act for consumers turned down for IVAs, now want the Financial Ombudsman Service and Office of Fair Trading to investigate the cartel of big creditors.

Source: thesun.co.uk

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See my Blog:
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aguise

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Post by aguise » Tue Nov 13, 2007 12:36 pm
The individual part of an iva seems to have started to be being lost because of these demands by the creditors, everyones circumstances and reasons are different and proposals should be viewed that way, not with we want 40p in the pound or no go. Creditors reading this please consider that people are trying to do their best, fair enough if you think they can pay a higher percentage but dont punish those that are making their best offer.

Ang

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tracy.h

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Post by tracy.h » Tue Nov 13, 2007 3:08 pm
It seems to me that the goal posts are getting wider and more people are going to struggle to secure iva's if this new stance is anything to go by.
It seems that there will be more people going br and that is unfair on those that want to pay there creditors as much as they can realisticaly afford.

Tracy
 
 

Adam Davies

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Post by Adam Davies » Wed Nov 14, 2007 9:40 pm
Hi
I'm only aware of HSBC with a hurdle rate of 40p,not too sure if this is an accurate rreport by the Sun

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matt.d

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Post by matt.d » Wed Jan 16, 2008 9:41 am
I spoke to Payplan yesterday re: and IVA and they can't help because of HSBC and their 40% benchmark. They did mention that HSBC were due to come to a decision at the end of the month regarding dropping this in line with everyone else. Anybody heard that as well or know whether they will drop their requirement?
 
 

Adam Davies

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Post by Adam Davies » Wed Jan 16, 2008 8:01 pm
Hi
There is an IVA forum meeting between creditors,IVA providers and The Insolvency services regarding the protocol and it could be that HSBC will drop their hurdle rate after this.
Regards

Andy Davie
IVA.co.uk Spokesperson and Website Manager

About me:
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IVA Helpline: 0800 197 4838
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luluj

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Post by luluj » Fri Jan 18, 2008 7:46 am
Sorry in advance for this i might not be too popular - I entered an IVA agreeing to pay back as much as I possibly could over the period of time - that for me looks to be almost 81p to pound, although with the extras over the years likely to be 100p !
We all took the finance from these companies to give ourselves lovely lifestyles that basically we knew we couldn't afford - I get really cross when I see and hear about those only paying back 25p in the pound, then in the next posting they are saying that they have managed to pay for a "Sun" newspaper holiday, saved money at Asda for future shopping, and have Sky TV installed etc - surely these are the areas in their I&E that need to be reviewed to enable them to pay more back to their creditors, who afterall are the ones loosing out at the end of the day!



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WolfUK

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Post by WolfUK » Wed Jan 23, 2008 2:15 am
Lulu, although I agree with you in general (and I am paying back around 70p in the pound) and I hate the "only pay 25%" adverts I do look back on my days of excess and feel that the creditors do have to accept some of the responsibility for the state of the credit industry. I doubt that many people here had problems getting the credit that got them into the state where they needed an IVA or to become bankrupt and I would have thought that some realistic analysis of credit reports would tell them if a person is likely to be able to afford the credit they are offering.
Simon
 
 

Adam Davies

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Post by Adam Davies » Thu Jan 24, 2008 3:19 am
Luluj
Quote "We all took the finance from these companies to give ourselves lovely lifestyles that basically we knew we couldn't afford - I get really cross when I see and hear about those only paying back 25p in the pound"

Not everyone has taken credit and used it for a lovely lifestyle,some people have taken credit responsibly but have fallen on hard times due to illness or business problems and everyone pays the whole of their disposible income into an IVA.
We do not judge people on this forum,instead we offer advice and support.
Please take this into account when posting in future

Andy Davie
IVA.co.uk Spokesperson and Website Manager

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
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nongnaleon

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Post by nongnaleon » Mon Sep 01, 2008 12:14 am
Hi
I agreed with andy myself and mywife have to do an iva because our business was going to hell.so we have to do everything for fund the business, mortgage,etc and looking after our deaf child.We never have a comfortable lifestyles we always sensible with the money until come though with the problem in the business.May be all the creditor see these sence what,when and why money had gone.Also we never miss any payment at all with all creditors so they gave us a very sensible amount to paying back.just want to let you know everyone is different I just want everyone to be debt free and can start a new life.
paul bloor
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