www.iva.co.uk

I have been in a joint interlocking IVA with my wife for about 10 months now and all is going well. I want to hire a car for something in a couple of weeks time. I've checked with the hire company and they need a swipe of a credit card when I pick the car up. They will not accept my prepaid debit card and neither of us have a standard debit card as our basic bank account doesn't issue them.

We do have a credit card that is still valid and is in my wifes name. We have had it since before the IVA went in place and to be honest we had forgotten about it. It had a zero balance at the time (which is why we missed it when we were applying for the IVA) and still has a zero balance now.

My question is - can we use this card for the car hire deposit. The actual hire fee is already paid - its just that swipe that they take in case I don't bring the car back or damage it that I'm talking about. The card has a £500 limit and in all likelihood the sole charge will be for a tank of petrol, about £41 which we will pay off as soon as it goes on there.

I've checked my IVA paperwork and it does say that I have to inform my IP about any additional borrowing over £500 but says nothing about borrowing under that amount. Any advice appreciated.

Personally I wouldn't. You are in effect attaining further unsecured debt (even if less than £100). The Hire company will pre auth the card amount and at that point you may find the card limit has already been cancelled by the issuer.

I would seek approval from your IP before doing so.

The fact it is already paid for and this is just a security measure I cannot see an issue personally.

Let us know how it goes

Hi there,

You will have to check your IVA terms as some allow up to £500 credit but the whole point of being in an Iva is to sort out debts and I think the temptation to use a credit card could get out of hand. That’s my opinion. You don’t want to jeopardise the Iva this early on I’m sure.

It maybe that the credit card you already have has terms and conditions were the holder of the account can’t have been in an Iva? You weren’t at the time of opening but now you are. I just have a gut feeling that the credit card before the Iva and still open may not be the right thing to do without asking further advice from your IP as they are ultimately the ones who can say yes or no.

I suspect you will find the card has been stopped/frozen when you go to use it.

You could try a small payment to test the water.