www.iva.co.uk

My stepson is in debt management at the moment, and has been asking us about our IVA. It would make sense for him to do as both he and his wife have a few debts.

The problem is that his car is on one of these options things, he is paying a fixed amount per month, then after three years he has to either give the car back or stump up some cash.

If he were to consider an IVA, how would this affect him?

How much does he owe Kallis? And how much is he paying into the DMP each month?

A lot of the car loans with balloon payments can be refinanced at the end, or it might be better to look at giving the car back now and just going for a straightforward HP agreement spread over five years.

Lots to think about and he ought to have a chat with an insolvency practitioner to discuss his options.

He has not long had the car (how the hell he got finance I don't know as he has been DMP for quite a while now) and he does need it for work.

I can't see him wanting to give it back, so I think he will have to carry on with a millstone around his neck for a lot more years than I do!

If it is a secured payment (HP) then he will be allowed to continue paying this once in an IVA. If the agreement contains a lump sum payment at the end (balloon payment) then this can usually be refinanced over a longer period. If they won't allow a refinance your stepson will have to return the car regardless of being in an IVA or a DMP.