The background. A few yrs back my parents bought a business and unfortunately soon after the purchase it became apparent that it was in trouble. In-order to buy time & make the mortgage repayments I borrowed money on credit cards & loans in my name & gave the cash to my parents. Not a good decision. Anyway the business folder regardless and I was left with 38k GBP of debt and nothing to show for it. I still has debts in excess of 23k GBP with 18k GBP on credit cards, the rest on loans. Im currently staying with my parents (on the couch) as they have a 1 bed flat, however this is temporary accommodation as they also lost the family home (which was connected to the business), so I shouldnt be there at all and need to move out asap. Iv no equity, property other than my car, which probably has a value of c2k GBP. Iv a full time job (take home of c2.2k GBP after tax) although most of my earnings go towards the repayments, making it impossible for me to move out.
I thought an IVA would be the best course of action.
1. During the calculations of the monthly IVA repayment, will typical personal expenses such as rent, food, petrol etc etc be taken into account - even if such expenses are not present currently i.e. until I move out? It's a catch 22, I need the IVA to move out but need the IVA to reflect the change in circumstance.
2. Will my employer be informed of the IVA?
I would suggest you talk directly with an IP (or two) in respect of your specific situation. You can find a list of companies at www.iva.com always remember to take the advice of 2 or 3 IP's or their representatives to ensure you get the best impartial advice. The experts who post on forum also come highly recommeneded. They will talk through all debt remedies with you.
There are guidelines to follow in respect of rent/food/petrol etc., I realise you're staying with your parents at the moment but as this is only a temporary measure you would need to inform your chosen IP and I'm sure something could be put into place.
I don't think your employer will be informed of your IVA, mine personally wasn't, although you will be listed on the Insolvency Register which is a public document if an IVA is accepted.
Please ask as many questions as you like and do continue to post as your journey helps other posters.
All the best.
IVA final payment left the bank on the 26th January 2013...looking forward to a debt free future.
I think we've all made those sort of bad decisions, hence us being on here!
Speak to a professional about this as an IVA could be a solution for you and I'm sure you will be able to sort something out around renting a new place and the associated expenses. Sleeping on a couch is not good for either you or your parents.
Visit www.iva.com for a list of companies and reviews. Give one or two a ring and you will receive free and impartial advice as to all the options open to you.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
It would be impossible for you to remain with your parents for five years so any IVA would be based on renting a normal property in your area. Get a list of properties for rent and show this to your IP who could draw up an income and expenditure account based on these figures. Any small changes to rent, council tax etc can be made later.
There is no reason for your employer to find out unless it is in your contract or they search the insolvency register.
One thing will be required to be clarified if you do propose an IVA to your creditors. How do your Mum and Dad intend to repay the loan they owe to you? Were they made bankrupt as a result of the loss of the business?
One thing will be required to be clarified if you do propose an IVA to your creditors. How do your Mum and Dad intend to repay the loan they owe to you? Were they made bankrupt as a result of the loss of the business?
Hi Melanie, thanks for your reply. My Dad is currently signed off permanent sick, and is currently filing for invalidity benefit and therefore currently claiming income support. My Mum also receives income support and will not return to work. Unfortunately she had a nervous breakdown due to the stress & trauma of losing the family home and their life savings. So as you can see there are no realistic plans to repay the money to myself hence why I feel I have no alternative but to seek an IVA. I'm in the process of taking advice from several IP's and hopefully will make a decision in the next couple of weeks. My main concerns are around how the IVA repayment is calculated. At the moment I do not have any funds available for rent, council tax, utilities etc and I'v been through several bank statments to calculate what my recurring 'reasonable' expenses are such as petrol, food, etc. A few people have mentioned a guideline I should follow for calculating these, are you able to give me some pointers here? My understanding is that there will be a fee to add to the amount paid to creditors, and then from this a monthly repayment schedule is outlined, for example over 60 months. Is this correct or is it a little more complicated than this?
The best thing would be for you to contact an IP firm which uses the CCCS guidelines and they can talk you through each allowance. We are not allowed to publicise the guidelines, and your expenditure ought to be based on what you actually spend rather than what someone tells you that you are allowed to spend - as your own figures could be higher or lower.
IVAs do generally run over a 60 month period, but they can be shorter or longer depending upon specific circumstances again.
Thanks Michael. I'v a few more questions if you don't mind...1) would an IVA prevent me having an overdraft facility?; 2) Would an IVA affect my current mobile phone contract? What if i decided to change my contract whilst the IVA is active?; 3) If I managed to save a little, how would this be viewed during my annual IVA appraisal?; 4) If I met someone during the IVA & decided to move in or shared a bank account, would this need to be declared to my IP?; 5) Is the annual review in person, therefore I should choose an IP that is easily accessible? & 6) What if one of my main creditors is my current bank account? Will I need to source a new bank account for fear of them closing my account & would you recommend this is best done prior to starting the IVA? Thanks D
Hi Melanie, I did try to speak with you in person today but you were unavailable at the time. I left a message with a colleague together with my contact number. Would you be free to discuss a few things? Thanks Dave
