Really Confused Now - Don't Know What to Do???!!!

[snowman365]

Dear Forum

I have been watching and contributing to this Forum for a few weeks now and before I start I must say that this Forum has been so useful and everyone seems so supportive friendly and informative. I now check it everyday and in some ways it helps keep me sane and feel that I am not alone in this situation.

I recently took the decision to face up to my debts and although I feel it is good that I have finally done it, in some ways I almost miss my days of having my head in the sand and not thinking about it!!! It seemed so much easier then. My head is currently all over the place - I really don't know what to do and what would be the best option for me to sort my debts out??? All I think about now is my debt and it is starting to affect my life in a bad way - I have become absent-minded at work, argumentative, angry and am not sleeping very well and keep waking up in the middle of the night with worry...

Up until recently, I had never really let my debt bother me too much - I have never actually missed any payments (yet), have had a fairly good standard of living, and I suppose I always thought that my debt was under control and I would continue paying it back until it was all gone.

However, I have now realised that never will and never would have happened. I have been juggling credit to pay other credit - shifting balances on credit cards, getting consolidation loans, dipping into my overdraft etc. I have been getting a lot of large bank charges lately for going over my overdraft limit - the other month I got charged £125.00 for one month!!! I recently tried to refinance my loan with Cooperative Bank and they refused, so went to my bank, HSBC, to try and get a loan to cover my overdraft and credit cards but they also refused - they said to try and manage my account better for the next 6 months and go back to them and try again - the funny thing was that in some ways it was their bank charges which were contributing towards me going over my overdraft limit, but they didn't see it like that!!! [:(!]

So, I took the plunge and then typed 'Debt' in on Google and found a whole new world!!! I guess before I felt that there was some kind of 'stigma' attached to being in debt and did not want to publicly admit to it or turn to anyone for help. I always thought I would get myself out of it somehow, but now I know that I do need help and don't know what to do...

Since then, I have posted a lot on this Forum and have recived some very useful and supportive answers but I am still not sure which option to go for.

I have about £45,000 of unsecured debt. It is owed to the following:

£26,500 - Coperative Bank Loan
£6,000 - Student Loans Company
£5,500 - Egg Card
£5,000 - HSBC Credit Card
£2,000 - HSBC Overdraft

I am 30 years old and live in rented accomodation, and have no major sellable assets. I have a car which is probably worth about £1,000 but needs some expensive work doing on it at the moment. I would like to sell it but can't really sell it without getting the work done. [:(]

I was initially leaning towards an IVA - I do feel a duty to pay back my debt as it is me who has spent it. I have contacted 3 IVA providers now and they have all been very helpful and nice and they are now waiting for me to get back to them and go ahead with the IVA. They have worked out that I could roughly pay back £400 each month into an IVA and that it would probably be accepted by the creditors.

But now, I am wandering whether BR might be a better option for me??? My main reason for this is that I have no assets as such, BR would not affect my employment, and I am currently seriously considering going to Canada to live and work for at least a year, possibly longer. My girlfriend is Canadian and she is now back in Canada after her Visa and Passport have expired and I would be eligible to get Permanent Residency in Canada on the grounds of our relationship and work and stay in Canada for as long as I want. I do not feel that I would be able to live in Canada and also pay into an IVA back in the UK, plus if I am to go out to Canada, I need to get my car fixed up to sell it and save money to get myself out there and have some money to help me settle out there - put a deposit down on a house etc. So, should I just forget about the IVA and go straight for BR?

Like I said, I have not missed any payments to my creditors but feel that I will have to soon as I have reached the limits for all my credit and can't juggle anymore. Should I miss payments on purpose to get a contingecy fund going? Would this make an IVA / BR more acceptable to the creditors? Should I contact them first before I do anything and explain my situation? Would a DMP be better for me?

Sorry for the long message!!! So many question!!! I just want to do something about it! It's driving me crazy!!! I have cut up my credit cards and am in the process of trying to open a Basic Bank Account elsewhere. I am due to pay me next round of debts soon (22nd) and don't know what to - whether to cancel the payments???

Any advice / info. would be greatly appreciated!!! [:)]

[Viki.W]

Hey Snowman, I was in exactly your situation and I too typed in "debt" in google. I had never heard of a DMP or IVA and thought that bankruptcy was for big companies. You have identified that you need help but only really a qualified IP can advise you. Is one of the companies you contacted Melanies's. If not, I would recommend you give her a call to go over all your options again. Viki X

[snowman365]

Hi LadyH!

Thanks for your reply and support!

In answer to your question, I feel that I would be a lot happier, and more free to live without my debt. I feel like it has really become a ball and chain and is holding me back in life.

I agree that IVA's are great and am very tempted to go for one, but I just don't honestly feel that I can commit to it for 5 years, especially as I am almost certainly going to be heading out to Canada for at least a year, maybe for life?!

My main concerns for not going BR is that it may affect my Visa application to Canada, or may affect the possibility of me getting a mortgage in the UK in the future. Apparently, BR would not affect me whilst in Canada at all.

A fresh start does indeed sound appealing...I would never get myself into this situation again...

[Viki.W]

Canada is the one place I would LOVE to live, never been but it's a little dream of mine. X

[snowman365]

Hey VikiW

Thanks for your reply also!

Yeah it's a whole new world in itself, this whole debt thing!

I did speak to Melanie's company yes, and the lady I spoke to was very nice and helpful. I feel that if I was to go for the IVA, then I would probably go with her - she seemed the most informed and nicest out of the 3 I spoke to!

I feel a bit bad though going back to her again and redoing the whole thing. Does she deal with BR also do you know?

[Viki.W]

Do you know snowman, I really don't know. You can go bankrupt yourself, you can download the forms from the insolvency website and you pay the fee of I think £495. Read Skippy's blog and go over to the sister site and have a read there. Ask lots and lots of questions, Melanie's team are really good with answering them all. Don't forget if you have disposable income then you prob have to pay IPO/IPA for three years, there is a table on Skippy's blog which will give you a rough idea how much you would need to pay. Good luck, Snowman, I'm where you are now and know how awful it can be. Thinking of you, keep posting. Viki X

[snowman365]

Viki

Yeah, Canada is amazing!!! You should go sometime! It's so friednly, and clean and wild.

I dreamed of going there for about 10 years, and have now been there 3 times since last January (when I met my girlfriend)!

Lots of snow too - good for snowmen!

[Viki.W]

[:D] When I first met hubby, he told me he had a dream to live in Canada when he's older, couldn't believe we had the same dream. My goal is to eventually save up to go for a holiday, check it out! X

[MelanieGiles]

If you are having doubts now about the IVA then don't do it! It will not work and you will end up resenting it if it stops you following your dream (and your girlfriend!!). Bankruptcy proceedings are very simply to put in place, and whilst all insolvency practitioners can advise you as to how to proceed with this to be frank all of the information you need is readily available on the Insolvency Service website.

Good luck with everything and don't feel guilty about making a fresh start. I have been to Canada twice skiing and it is truly a fabulous country.

[charlotten]

Hi

Ironically I was on the CCCS website today and I was perusing their question site and it says that you can have an IVA or declare bankruptcy and still live abroad.

In your case your debts seem to have gone to far and I would suggest bankruptcy. You will discharged within a year.

This is my opinion mind!

Check our the CCCS website - www.cccs.co.uk.

Life is too short. With debts dragging you down if I were you I would declare bankruptcy and go to Canada!! (If you can) The UK is horribly expensive now anyway.

I have an IVA and I am in the process of failing it. I'm pregnant and my husband is an Accountant so it has been a worry and the IVA was too restrictive for us. We were paying £478 to DFD (IVA) and £400 in Council Tax arrears because DFD failed to act fast enough two years when we took out our IVA and now we are struggling.
Our IP has agreed to look into our case. We can't declare bankruptcy as my hubby would lose his job.

I don't like IVA's. They work for some and not for others.

Obviously you do what you need to do.

Take care

[snowman365]

Hi Viki.W!

Cheers! I think I'm always one reply behind your message, so sorry if it doesn't quite make sense!!!

I will check Skippy's blog...

I do have disposable income at the moment yes but if I were to go to Canada then probably not...maybe I should go for an IVA for now and if I do go to Canada then go for BR if I can't afford the repayments???

[facingittogether]

hi snowman

i cant advise you which way will be best for you, but i do know that once you have made a decision and got the ball rolling you will feel a weight has been lifeted from your shoulders. i do know though you need to come to a decision and act on it as this worry and stress can not be doing you any good!

good luck in whatever you decide!

barb x

[snowman365]

Hi Melanie and thanks for your reply also!

To e honest, yes I am having doubts about the IVA in the long term. I am almost certain to go to Canada in about 6 months, maybe less andwould not want to be paying into an IVA from abroad - £400 here is $800 there - a lot of money!!!

I will check out the Insolvency Service website. If I were to go BR, would I have to pay the same amount to the OR as I would in an IVA? Would I still be expected to pay the OR from Canada?

Yes, it was the snow which first took me to Canada also - I amqualified to teach Snowboarding in Canada and I agree - it is truly a fabulous country!

[snowman365]

Hi Charlotte

Thanks for your eply and the info. about CCCS - I will check out their site!

Yeas, it does feel like my debts have gone too far! I agree - life is too short! Sinc turning 30 a couple of weeks ago I feel like I need to start living more and doing the things which I really want to do with my life and with the people who are important to me. I am sick of this life of debt! And yeah, the UK is very expensive!!!

Sorry to hear about your situation, but congratulations on the baby! I hope that you get yourselves sorted out. That's what concerns me about the IVA - the fact that you're tied into a set amount for so long.

Good luck to you!

[MelanieGiles]

In bankruptcy, the repayments (which are over a three year period) are usually lower than in bankruptcy - usually between 50% and 70% of your disposable income.