I am unsure what to do

[vike1967]

Hi I am unsure what to do - I have been on a DMP for 15mths paying 350 per month and have about 50k unsecured at this rate will take 12years to clear.Most of this debt was run up while I went self employed and stupidly I used credit cards to fund day to day bills and thought the business would fund itself - it never did - I ma now employed an d earnt 39k last year so my income is back to an acceptable level so I tried to get a secured loan today and was refused but was referred to an IVA adviser who said an IVA would best suit me.

I dont know - my house is worth 220 ish and mtg is 190k but cant get equity out and it would clear anyway.

My other problem is I work in financial services (mortgage broker)and I am worried my employer will find out and fire me -although i cant see anything in my contract I worry this could happen. Is IVA best route for me as the debt will be gone in 5yrs - I cant face waiting 12years before I can go on holiday again or have a treat - this is all getting on top of me , I am a family man and feel as though I cant provide for my kids and their childhood will be over in 12 years - any help please

[Adam Davies]

Hi
an IVA is a formal insolvency agreement so be sure to check your terms of employment thoroughly.
Will your income stay at that sort of level given the market conditions at the moment ?If so can you afford to increase your current £350 per month into the DMP ?
Regards

[size5]

I would echo Andy's concerns, but would say the following, you need to speak to a specialist as soon as you can.

It is to be assumed that your DMP was set up on what you could afford 15 months ago, and you seem to have kept up with it with little problem, but you have also indicated that your circumstances have improved a little, am I correct in that?

As IVA's are based on affordability first, rather than level of debt, you need to work out, with the aid of a professional preferably, how much your disposable income actually is at present. Then there are various other factors to be considered. Are there any joint debts? Are there any debts in the 50k that are your wifes, or does she have other debts separate to you?

It is likely that if you go down the IVA route then you will be required to release equity at the end of the 4th year, if that cannot be done, for example if house values continue to fall, then it may be that you will have to extend to 6 years.

If your income IS subject to fluctuation, then maybe your DMP, to be followed by a release of equity in a few years to fund full and final settlement of the debts at a significant discount may be a better option. There is so much that needs to be looked at before a recommendation can be made, details which you may not want to share on a public forum.

As I said before, you need to consult a specialist as soon as possible, you may wish to visit www.iva.com and have a look at the reviews there, I would certainly speak to 2 or 3 different providers before making you next move.

Regards.

[MelanieGiles]

Can I ask when you entered into your DMP arrangement were you advised about other options including an IVA and, if so, what made you choose such a long term uncertain procedure over the benefits an IVA could bring? Perhaps you wanted to keep the equity in your property completely outside of your repayment plans, and this is understandable, but the length of time that your repayments will take would make a DMP seem a very unfavourable option.

As the other posters have said there is no harm in getting further advice from an insolvency practitioner as to the other options available to you, and may I ask who your DMP is actually with?

[vike1967]

Hi I am unsure what to do - I have been on a DMP for 15mths paying 350 per month and have about 50k unsecured at this rate will take 12years to clear.Most of this debt was run up while I went self employed and stupidly I used credit cards to fund day to day bills and thought the business would fund itself - it never did - I ma now employed an d earnt 39k last year so my income is back to an acceptable level so I tried to get a secured loan today and was refused but was referred to an IVA adviser who said an IVA would best suit me.

I dont know - my house is worth 220 ish and mtg is 190k but cant get equity out and it would clear anyway.

My other problem is I work in financial services (mortgage broker)and I am worried my employer will find out and fire me -although i cant see anything in my contract I worry this could happen. Is IVA best route for me as the debt will be gone in 5yrs - I cant face waiting 12years before I can go on holiday again or have a treat - this is all getting on top of me , I am a family man and feel as though I cant provide for my kids and their childhood will be over in 12 years - any help please

[vike1967]

My DMP is thru CCCS - IVA was thought incorrect as I had equity then but house pricesnhave fallen and i cant raise more mtg as i am maxed out-my income fluctuates and averages 2400 but this is expected to go down as my employer without notice changed commssions levels due to the market - my debts are in my name only - my wife doesnt work- the 350 per month has been manageable but difficult especcially for unexpected bills ie car repairs.As i say this firm I approached fr a secrd loan declined me but suggd iva maybe best - but seemed abit pushy and they are sending someone from warrington to collect my payslips etc -i am in dorset- seems bizarre- or is this a good buz to be in - worried about this having to go thru local court as well as know someone there who works on bankruptcies - do i just carry on with dmp and hope i win the lotto or some long lost relative leaves me an inheritance .

[pbeck]

On the information that you have provided it does seem that you are suitable for an IVA.

Don't be pushed into taking the first company that comes along, do some research and pick someone that you are happy with.

12 years is too long to continue a DMP for. You would only have to remortgage your house up to 85% of its value anyway, as the mortgage is currently in excess of that you wouldn't have to remortgage at all unless house prices start going up again (probably likely to continue going down for the time being), and/or the balance on the mortgage debt reduces.

[MelanieGiles]

CCCS have their own internal IP now, and it may be worth you having a chat with her to see whether she would be prepared to put forward an IVA for you - as it seems to me that this is the most sensible way forward for you given the suggested duration of the IVA. If they are reluctant to do this, or you feel that you would be better by taking independent advice, then you should contact an insolvency practitioner who will advise you on all options available to you.

Although Philip is correct about the 85% loan to value issue, creditors will still view the whole of your equity as being available when reviewing to see if an IVA is acceptable to them. Therefore if you are showing contributions and total equity either equal to or more than the amount you owe to creditors, an IVA may still not be acceptable to them - especially if they have been used to collecting DMP payments.

[size5]

I agree in as much as £350 would be enough to fund an IVA proposal but I would urge caution as you have stated that the £350 is managable now, but only just, and doesn't allow for contingency expenses. You also talk of possible loss of income so it would seem that perhaps the £350 is not sustainable for anything other than the short term. There are many tales of woe elsewhere on here where people have had a change in circumstances which causes them to struggle in an IVA. If these things are unforeseen and can't be helped then fair enough, but if you know that a possible/probable loss of income is around the corner then I urge you not to make a rash decision and as Philip says, to speak to a few people first before you make your mind up.

Regards.

[vike1967]

thaank you for your advice - I have been approached by another firm who seem alot more professional vincent Bond and Co. Any feedback would be appreciated- They have told me to open a bank account elsewhere but i am getting turned down - i have tried co-op, All and Leic , barclays any suggestions ?

[angela18]

hi vike check out iva.com it gives you feedback on most IVA companies. i'm with melanie and could not say a bad word about her company

[Viki.W]

Vike, maybe if you list your creditors, the experts could tell you which banks you could apply to that aren't connected to your creditors.

[angela18]

we have an halifax easycash account which is just an electron card. no overdraft or anything.. you apply online for it

[vike1967]

not tried halifax as i have credit crd with them

[size5]

Have you tried the Co-Op for a Cashminder?

The number is 08457 212 212 and press the hash key.

Regards.