Should I pay my creditors while applying for an IVA

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johnny832
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by johnny832 » Fri Apr 27, 2018 11:37 am
Hi

I am in the process of starting an IVA I have debts with 3 credit cards, Very, DFS and ratesetter totaling £9000

I've never missed any payments and have always managed my own finances however due to my interest free payments ending on my MBNA credit card (£4500 owed) the payments went up to £150 a month gaining £110 interest every month and my wife recently having our baby and having her hours reduced at works make the payments un-affordable for us.

My question is, I range the IVA company yesterday and they said that I had a really good chance of getting accepetd and started the process where the contact the creditors for approval (Witht he exception of shop direct, as I'd recently spent on there) all the creditors looks to accept when they ran the credit check report thingy majig!

My payments are due on the 4th May totaling in at £300 I can afford this but it would leave me with virtually no money for the rest of the month. My IVA adviser said it was my decision to default on payments this month in Lieu of being accepted for the IVA? my worry is that I won't be accepted and then I'll gain the missed payments charges etc. Like I said I've never ever missed payments in the last 3 years and don't want t start now but see no other option!
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luluj
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by luluj » Fri Apr 27, 2018 11:47 am
I personally would use this time to save the money for when an emergency crops up in the iva - you won't have the chance once ita started.
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Foggy
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by Foggy » Fri Apr 27, 2018 11:53 am
First I would urge caution regarding the advice you have already been given. The chances of individual creditors accepting the IVA cannot be predicted and has no relation to any information on a credit report. I would suggest a chat with a couple of firms to compare advice. They would not normally be contacting creditors at this stage either. In the normal course of events they should first do a full review of all of your finances and circumstances. Then draft a proposal for you to read and agree --- only then do they contact creditors to advise that an IVA is being proposed, giving them notice of a creditors meeting, at which they will vote on whether to accept or reject the proposal.

On the question of whether to pay in the meantime .... most of us stopped regular loan repayments once we had decided on the course we wished to take. Some made token payments and a few even made full payments -- in the grand scheme of things, it makes no difference to the outcome.
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kallis3
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by kallis3 » Fri Apr 27, 2018 12:13 pm
I agree with Foggy - speak to a few more firms before making a decision and squirrel away your payments as a contingency fund in the meantime. If you have any online accounts, go in and remove phone details so you can't be contacted via phone.
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Lisa Thomas
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by Lisa Thomas » Fri Apr 27, 2018 2:48 pm
I would stop making the payments in readiness for an insolvency procedure and in any event you can't afford to make them.

Feel free to contact me if you want a second opinion on the IVA/options.
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