Is an IVA right for us?

[worriedmart]

I see what you saying, seems that if we had more debt with more creditors (Which really should be seen as worse) we would be suitable for IVA's.... which I would of course prefer than going bankrupt.. So seems like we have to take the heaviest option for not taking out more credit if you see what I mean.. I would have been better off if we had more credit lol.. the wonderful world of money.

If I didn't joke about it I would probably have to lock myself away in a room somewhere. [:o)]

[aguise]

If I was you I would explore the possibility of bankrupcy. I think it still would mean that they would chase your wife for the loan payment so maybe considering both going bankrupt may be the answer. I think if you had an ipa it is usually about 50% of disposable income.
Ask what you want, that is what the forum is for.

Anng

Please visit my blog at http://aguise.blogs.iva.co.uk/

[catullus]

Hello Worriedmart

It's not really the amount of the debt that makes your decision a difficult one, it's more the split between you and your wife that causes the difficulty.

If you entered BKR and your wife did not then the OR would assess your DI for IPA purposes assuming that your wife contributed a reasonable amount to household expenditure. In deciding what income your wife had I believe (but I'm not 100% certain) that the OR would have to accept that out of her income the first payment would have to be the repayment to IF or the maximum amount she could pay.

I must admit that it would be hard for your wife to accept that she should opt for BKR with only one debt for £10k, but whether it's £10k or £100k, if you can;t afford to repay it, you can't afford to repay it.

I really would read some of the blogs of people who have gone in to BKR to get a feel of the personal issues. Being a techie I doubt that BKR would affect your work but you should check this out with your employer.

As I said previously if you decided for whatever reason that BKR wasn't for you then I think DMP may be a better route for you both but it really wouldn't be a solution to your problem.

[worriedmart]

Thanks, thing with a DMP is that its not legally binding, and would just really be putting off the inevitable. I would like to get our problems sorted out now so we cant start afresh if possible.

My wife brings home about £520.. after her phone and child care costs she is left with £230 which would pay the £175 to IF.. We've never really thought of money as seperate, we just put it all in the pot and use it together to get through the month. If it was seperate and as above, then I would be paying for all food, rent, ctax, water, elec, gas, petrol, insurances etc.. Would this be deemed ok? Or would they expect my wife to pay some of that meaning, as an individual she wouldnt have enough left to pay £175 to IF.

Confusing stuff

[catullus]

That was the point that I made above. I believe (but not 100% sure) that the OR would have to accept that the first call on your wife's income was the IF debt.The reason why I'm not 100% sure is that there isn't anything said about this in the OR's technical manual and I think that the decision would depend upon which OR you dealt with.

I'm an IP, however, and I would accept that your wife had to pay the IF debt in full. This would mean she would have far less income to contribute to the household making you more responsible and thus reducing your income for IPA purposes.

As for DMP's I completely agree although they do sometimes have a use, but not for you I suspect.

I should add that what I've said above is marginal from an IP's point of view and it may be that Melanie may see things differently from me. I'm sure she'll review these posts and so it would be worth monitoring the forum to see what she has to say.

[MelanieGiles]

An IVA is unlikely to be an unsuitable solution for either of you, because Black Horse have a policy of rejecting most cases where the debt is higher than £7,500 and, as other posters have stated, your wife could not present an IVA with just one creditor.

In a bankruptcy scenario, the OR will review both sets of income and expenditure to assess whether Income Payments Orders are viable. The OR tends to work on the basis that you share housedhold expenditure equally,and therefore you ought to firstly identify whether your wife could afford to avoid bankruptcy and continue to pay her one creditor, perhaps leading to just you declaring bankruptcy.

Catallus makes an intersting point, and one which is very close to my heart at the moment, in that there does not appear to be a consistent approach with regard to the way the Official Reciever views bankruptcy cases - and this therefore makes it quite difficult for professionals like us to give definitive advice as to what would happen under bankruptcy proceedings. Even our resident bankruptcy experts - Skippy, Scaredkez, Zoe and Mish all have different things which have happened to them. And the one thing to remember about applying for bankruptcy, is that once it is done you cannot change your mind, so careful consideration should be given to the way forward before you make your application.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[worriedmart]

Thanks, I think I will look at a DMP for us, and see how it goes. BR is for sure the last resort.

Thanks again for everyones help.