Recently Settled IVA

[tinks]

Hello everyone

My dad recently settled my IVA for me and I now pay him back £342 per month for the loan he took out to settle it. I am waiting for my certificate, which I should get at the end of August.

I went to buy a Mini One on Saturday - as I have recently had a payrise and can afford all the repayments, however the only finance company that would accept me for credit on the car have quoted 29% APR.

My credit score is split - I never missed any payemnts or had any defaults against me, I just overcommitted myself and found I was lucky to break even each month and was struggling to keep my head above water which is why I went for the IVA - I wish I hadn't. My credit score is fine but my additional notes, about the written off debt are what is causing the rejections.

If I could turn the clock back and do it all over again, I a) wouldn't get into so much debt (lol) but b) would contact my creditors directly and ask them to agree a payment scheme acceptable for me and them.

The IVA is on my record for the next 6 years, and although I settled at 22, it will still be there until I'm 28 and I am not overly happy that I am going to spend my twenties (supposedly the best years of my life) trying to rebuild my credit profile so that I can get a mortgage and a car etc.

Tip for people considering an IVA - speak to a non profit orientated financial advisor or specialist before entering into one. These insolvency companies will bleed you dry in fees and encourage you that it is your only option...IT ISN'T! Speak to you creditors directly, they aren't as bad as you fear and try to arrange something between you without involving insolvency companies.

Just don't get backed into a corner like I did - I am now struggling with what decision to make, do I take the 29% APR and get my little car or wait 6 years til my credit improves?

Who knows!

[MelanieGiles]

Why do you feel you were backed into a corner in entering into your IVA, and how much money which you owed did you actually get written off as a result of the IVA?

I feel sure that an ongoing payment arrangment with your creditors may have taken you far longer to repay, and your credit scoring would equally have been affected for a six year period in any case. Unfortunately this is a consequence of borrowing money that you cannot afford to repay.

If a new car is that important to you right now, could your father take out the finance in his name and could you pay him back?

[Viki.W]

Hey Tinks, sorry you are having all this hassle. It sound to me that maybe you didn't have ALL your options discussed with you before you started your IVA. A good Insolvency Practitioner will discuss this with their clients. I know I would never, ever be able to negotiate directly with my creditors. My debts are too many and too high. I need the protection that an IVA will bring if mine is accepted. All my options were discussed with me and I chose the IVA and my credit score was shot anyway because I was struggling to pay my creditors.

Have you tried looking at leasing a car. You could try www.secretariatservices.net They deal with people with rubbish credit scores. Good luck. X

[lighton]

I dont understand this thread surely being in debt once was enough you are still paying your father back and you want to get aloan for a car isnt this going back to square one , i know the iva has taught me one thing and that is to save before i can buy.

[flow13]

I agree with lighton. We will never have credit again once the IVA is finished. The only thing we will be prepared to do is have a mortgage (if anyone lets us), but thats just like paying rent. If we need something we will be waiting until we can afford to pay cash.

[Til]

I agree too - in some ways our ruined credit score is a good thing as it will stop us being tempted again - we will not have credit again either unless it is for mortgage - if we can't afford it we won't have it - simple.

[jtomo64]

The fact that you never missed any payments may have looked good on your credit profile, but believe me, the minute you start talking to your creditors then your credit rating is affected. I doubt your credit profile would look any better than it does now if you had not chose the IVA route.
I personally have never missed a payment in years, and probably have an excellent credit rating right now because of that; but that does not mean I am not up to my eyes in debt.
It does not really matter which route you take to clear your debt problems, the outcome where your credit profile and rating is concerned would not be much different. You speak to your creditors and your credit file is marked accordingly, you follow the IVA route and your credit file is marked accordingly, you begin the long process of a Debt Management plan and your credit file is marked accordingly, and we all know the consequencies of declaring bankrupt.

An IVA is not an ideal solution by any means, but it is a solution.
If there was the ideal solution out there, then we would not have this forum, and we would all be living the perfect life financially.

I ask myself one question here.
Do you really need that new Mini One right now? If you have a pay rise and can now afford the payments as you say, then why not wait a while and save the money to buy the car without credit, knowing its all yours and not having to make payments at high interest rates should be satisfying to say the least.

Dont let yourself fall into the debt trap all over again.

All said, I wish you well.

J.

[flow13]

That is so true j. Debt is so tempting - well not debt but the offer of money. The company's lure you in, and then when it all goes wrong....well I am living proof of when it all goes wrong.