Questions re IVA

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wanttobedebtfree
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by wanttobedebtfree » Thu Sep 07, 2017 7:32 am
Hi

I'm new to this and finally taken the plunge to speak to someone about my debt! Long story short I have a rather large amount of debt to a fee creditors which I have told no one about, including my partner. I have since been starting the process of an IVA however I have a few questions that are constantly playing at the back of my mind:
1. My mortgage is due to be renewed in 2 years and I worry that at this stage we'll be rejected for a remortgage and my partner finds out why
2. My car finance agreements ends in 2 years and again I would have to try and agree new finance because I have no funds to buy a car and I worry this will throw something back

I know I should tell my partner but he is in a stressful job which I don't want to make worse, and I keep thinking that in 5 years time this will all be over and I can forget about the past debt and move forward.

Thanks in advance
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Ryan
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by Ryan » Thu Sep 07, 2017 7:52 am
With regards the Mortgage depending on who your Mortgage is currently with they may be willing to offer you a new rate when the current one expires or a Broker such as ourselves may be able to do similar. You wouldn't be able to re-mortgage to a High Street Lender for at least 6 years from when you enter into an IVA if you choose to do so.

I would imagine it would also be very difficult for you to obtain car finance during that period of time as being in an IVA will mean you will normally fail Lenders credit scores.

Regards
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Foggy
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by Foggy » Thu Sep 07, 2017 7:59 am
The mortgage might be do-able. I have seen a few renewals whilst in an IVA -- after all the lender isn't increasing their risk, but more varying the terms. However, keeping the IVA under wraps will be difficult. As for the car ... you will not be able to finance any balloon payment or renew with a new car.

Are you in a joint mortgage ? If so your partner will be asked to sign a restriction on the property and you will be required to attempt to remortgage towards the end to release equity.

Hard as it might be, it will be easier for you both in the long run if you come clean to your partner. Hiding an IVA for 5 or 6 years will be a strain and might prove impossible.
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Michael Peoples
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by Michael Peoples » Thu Sep 07, 2017 8:24 am
If there is a jointly owned property the IVA should not really proceed unless the joint owner is aware of the IVA. Apart from signing the restriction they should be able to seek their own independent legal advice which they cannot do if they cannot afford to. I agree that you should tell your partner and perhaps he could then help when the vehicle needs refinancing as you will struggle.

I had a client a few years ago who had not told her husband. I explained she should really do so and she decided she would tell him over the weekend. She made him a cup of tea after 'Match of the Day' and sat him down. When she had finished telling him he burst out crying and said 'I knew there was something wrong but I thought you were having an affair. It is only 'Effing money' and we can sort that out'. The client said it was the best thing she had ever done and her only regret was not doing it sooner.

He may be a bit shocked but it is not the end of the world and only 'Effing money'.
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kallis3
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by kallis3 » Thu Sep 07, 2017 10:35 am
It took me a long time to tell my husband (not in the best of health) and it made him ill as he didn't realise just how much debt we had. Did an IVA each, now finished and we have no secrets anymore. It's hard but you will feel much better in the long run.
wanttobedebtfree
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by wanttobedebtfree » Thu Sep 07, 2017 11:02 am
Thanks for the advice.

I have thought so many times about what I would say to my partner but I worry that he takes it bad.

I do wonder if it is the right option for me based on the fact:
1. I am not missing payments for anything
2. We do have relatively good incomes.

I have just noticed recently that we are struggling month to month after everything has been paid. I have made a few changes to our budget in terms of reducing mortgage amount recently, cancelling gym membership, and other expenditure that we do not require. I have even thought about a second job.

Is an IVA something that I should really only consider if I am defaulting on payments?
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Foggy
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by Foggy » Thu Sep 07, 2017 11:16 am
A lot depends upon the level of debt, but, in the short term you could try a Debt Management Program (DMP). Have a read here:

https://www.iva.co.uk/debt-management-plan
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Michael Peoples
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by Michael Peoples » Thu Sep 07, 2017 11:53 am
An IVA is not something to rush into and all options should be looked at. You could consider consolidation, debt management or even bankruptcy depending on your personal circumstances and any insolvency firm should be able to explain each option to you.

Cutting back on unnecessary expenses may help but unless you can stop using credit to survive you may need to look at some form of debt help. Advice is free so speak to an insolvency firm and see what options there are. You partner will never know you took advice.
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moira717
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by moira717 » Sat Sep 16, 2017 5:18 pm
Spent 5 years plucking up courage to tell my husband. Similar story to Michael's. I left him a letter while doing school run as couldn't face him. When I got home he asked if anything else (thought being in 50,000 debt was quite enough!). He knew something was wrong and thought I was having an affair. He said the debt was a relief and should have told him earlier. He thought my letter was a dear John. Know there is no way I could have kept it secret for next 6 years. Good luck
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