I am about to enter into an IVA, but I have a couple of concerns.
I am in the armed forces and I may be selected for redundancy, I will receive a lump sum if this happens so I will be able to clear my debts, but I am concerned that I will also be liable for all of the IVA charges, so I will if fact potentially make the amount of money I owe greater than when I started.
Secondly, If I stay in the forces and complete the IVA, i will need to raise around £2000 from my property, would I be able to save the money during the 5 years and pay off the remaining balance rather than releasing equity.
Hi Andrew and welcome, I guess what you have to weigh up is the amount of interest and charges you would continue to accrue without the IVA protection whilst waiting for your redundancy, against what the IVA fees would be.
If you can manage to save the £2k during the life of the IVA out of your existing allowances then it would seem possible, however you do have to have your house revalued in year 4 anyway and the equity release will be based on the valuation at that point, so it may be higher or lower than £2k anyway.
What you need to do is speak to an IP who is well versed in dealing with service personnel.
We do have one or two experts on here who can help you out.
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
Hi. How far are you into the process? Modern IVA's generally exclude equity if it is less than £5k, so you might get away with that aspect (but, if you can, it's always advisable to save during the IVA, for all those spanners life has a habit of throwing).
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Could you not hold out a few months until you are certain about the redundancy? Paying off your creditors with your remuneration will save you having a v bad credit rating for 6 years if you enter an IVA.
Last Payment made 04/12/14. Completion Certificate 25/7/15. IVA company GT. No Issues
Whilst you are awaiting the outcome of your redundancy notification, it may be better to look at a DMP agreement - and if costs are an issue for your Payplan and the CCCS will do this free of charge. You could then pay the remainder off when you receive your lump sum.
Still worth looking at an IVA as an alternative as making decisions can be much easier when you have a range of options to hand.
