We have amassed a total of 90k of debt

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by sarah403 » Wed Jan 31, 2018 4:12 am
We have amassed a total of 90k of debt spread across 4 loans and 7 credit cards. Our monthly payments on these now exceed 1700. We are 300 short each month after paying all houshold bills. We are borrowing from one to pay another and this will only last another 2 months.
I have done a debt remedy with step change and been researching IVAs and think that this is our only option. I also feel that this is the wake up call and lifestyle change we need.
Do I start defaulting on minimum payments now? Most are due 1st Feb. They would be paid using overdraft facility. Would this be a negative or positive in our IVA application? So far we have kept above water and met all payments.
I don't know what to do foe the best.
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by luluj » Wed Jan 31, 2018 6:16 am
Welcome and well done on taking the first step in addressing your debt.
You need to start taking some advise from insolvency teams to ensure the iva is the right option over say bankruptcy. Talk to 2 or 3 companies and then agree to go with one and have a solution proposed to creditors.
Once it has been proposed stop making payments to creditors and use this time to build a small contingency with the money you are then saving from not paying your creditors. Creditors know that once an iva is proposed monthly payments tend to stop.
Where possible maintain your household expenses such as mortgage, utilities and council tax - stop the credit cards and loans. You need stopped all rather than some as you would not want to be seen treating one differently.
Good luck and let us know how you get on.
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by Foggy » Wed Jan 31, 2018 7:39 am
I echo Luluj's advice. Chat to a couple of firms -- to get a feel for how they operate. Make sure you are really happy with the allowances they give you going forward and start the ball rolling. When you have made a firm decision to proceed and the IP is happy to put the proposal forward then you can stop unsecured loan payments.
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Lisa Thomas
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by Lisa Thomas » Wed Jan 31, 2018 9:24 am
You should take advice from an IP to make sure an IVA is the best option for you.

If you decide to go ahead with an IVA then once the Nominee has been instructed you should then stop paying creditors.
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by watzki » Wed Jan 31, 2018 9:09 pm
Also get a new bank account that is not tied to any of your creditors before you start the process.
We got a basic bank account set up with Nat West
Good luck
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by kallis3 » Wed Jan 31, 2018 9:13 pm
Co-op are also recommended for a bank account. Has to be set up on the phone or in a branch.
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