I am £30,500 in debt. My income is £15,545 per annum and my husbands is roughly £6200 per annum.
My job current started in October so we currently receive £520 in tax credits per month, mainly to cover childcare costs of £370 per month.
We also receive £82 child benefit. My husband is in the final year of his own IVA for debt accrued before we met, for which he pays £80 per month.
As of April our tax credits will go down to roughly £320 because of the full yearly wage being taken into account. If we are very frugal our outgoings will leave us with approximately £150 per month which we could put into an IVA.
If my husband takes on more hours we would have to take on more childcare and get a dog walker, and of course pet allowances are very small on an IVA.
My parents are buying a second house to rent to us, we would essentially be paying off an interest only mortgage for which they have a duration of seven years (they are in their 70s), and then my husband will look to get a mortgage for a longer period - we are currently in social housing. My husband would hopefully be in a position to get a modest mortgage at his point because our daughter will be older so he can take on full time hours.
I applied for an IVA in September when I was on part time hours and they accepted my proposal to pay them £100 a month with modifications. The modifications were that the IVA would be 6 years, and that I sought full time hours, and that when I got full time hours that 100% of any extra money would be put into the IVA. I was told by the provider that they would take into account expenses incurred for meals at work, fuel, car maintenance, childcare etc. However when the paperwork came through I discovered that they had only allowed for childcare and fuel. I also discovered that I would not be allowed to make pension contributions over 5.3%. My employer's pension scheme is set at 5.4% which means I would have to opt out of my pension for 7 years.
On the basis of this I decided that I would allow the IVA to fail and apply for bankruptcy when it did. For some reason I thought that you were able to pay in installments for bankruptcy AFTER, not BEFORE the application was made.
I am now in a situation wherein it's going to take me four months to make an application for bankruptcy because of the fee, but I am worried that the creditors will make us pay unaffordable fees if I enter into an IVA, and that I will not be able to pay into the work pension scheme. If I went for bankruptcy would the creditors take me to court during the next four months? Also my car is essential for work but is currently valued at £1075 (with the milage going up quite a lot per month due to our remote location and the nature of my job in four months time this is likely to be more like £1025). Any help would be greatly appreciated.
My main concern is that if I wait four months to get the BR fees together the creditors will take me to court. Would you think this would be likely to be an issue?
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