www.iva.co.uk

Hello all,

I have a few questions if anyone could please offer any answers it would be much appreciated.

I have spoken to creditfix, gone through the application and just awaiting my paperwork to sign.

I have a mortgage and I cannot seem to find any information regarding mortgage payments once IVA is active.

For example, my fixed rate ends in around 4 years time, when it ends will my mortgage company hit me with huge interest because of the IVA on my record? Can I just leave the mortgage running and will it just switch to the standard rate?

They have also told me I will need to switch bank accounts as nearly half of my debt is on credit cards with my current bank, else they could freeze my account and take funds from it? Has anyone else had to do this?

They also told me I need to switch energy suppliers because they are passing forward my outstanding balance from my supplier, and I might need a pre payment meter fitting? Has anyone else had an issue with energy suppliers? Do I switch before the IVA gets approved?

This all came about when the interest rate on my credit cards got too much and I asked them if they could freeze the interest for 1 year to allow me to try and pay it off. Isn't it crazy that these banks would rather people go for an IVA rather than give them free interest for 1 year.... I can't understand the logic behind it at all. I lost my previous job and are now earning half what I was before, when you are in a good financial position you get such great deals, but the moment you need a little help when you are struggling they don't care..

Will have a read through the forum and try take in as much information as I can.

Thanks all

On the mortgage front, your payments will be allowed as part of your expenses. When the current deal expires you will, most likely, revert to the standard variable rate, although I have seen some lenders offer a new fixed rate deal, at times even better than the expiring one .... the mortgage market is too fluid to predict, but their security is in the property, at the end of the day, which isn't changing.

If your bank is, or is linked to, one of your creditors then you must change bank accounts, most of us have had to do this.

Electricity supplier being rolled in as a creditor is a new one on me and I have not come across this before. Unfortunately CreditFix tend to do things their own way, which makes predicting what they are up to difficult. If they insist on doing this it would have to be before the IVA has been put in place as, once it has, your credit score will be trashed and, while you won't be left without a supplier, you will be on the higher tariffs. It is a stupid move as your power bills will increase, so allow for this when doing your I&E.

Wed Mar 31, 2021 7:10 pmFoggy wrote:

On the mortgage front, your payments will be allowed as part of your expenses. When the current deal expires you will, most likely, revert to the standard variable rate, although I have seen some lenders offer a new fixed rate deal, at times even better than the expiring one .... the mortgage market is too fluid to predict, but their security is in the property, at the end of the day, which isn't changing.

If your bank is, or is linked to, one of your creditors then you must change bank accounts, most of us have had to do this.

Electricity supplier being rolled in as a creditor is a new one on me and I have not come across this before. Unfortunately CreditFix tend to do things their own way, which makes predicting what they are up to difficult. If they insist on doing this it would have to be before the IVA has been put in place as, once it has, your credit score will be trashed and, while you won't be left without a supplier, you will be on the higher tariffs. It is a stupid move as your power bills will increase, so allow for this when doing your I&E.

Thanks a lot buddy,

Been reading your replies to multiple threads, and would just like to say kudos to you, you are a great asset to this forum.

The annoying thing is, I have never missed a single payment for any bill, but my job loss/new wage coupled with my credit card interest rate shooting up gives me no other option, I wish they could offer me a simple solution i.e. give me 0% interest for 1 year so I can sell some assets and repay them in time. They are going to lose out more if I can down this route and its not beneficial to any of us.

I was all happy earlier regarding the IVA, but the more I read about it I don't know if I'm making the right move.

I.E. If I get a good salary job in the very near future, could this end up costing me the same as I would of paid anyway, but also tarnish my credit score?

Thanks again!

Thank you for your kind words.

I would suggest, before signing anything, a chat with Stepchange about an interim Debt Management Plan, where some creditors are willing to accept reduced payments and freeze interest for a period of time. I mention Stepchange because they do not charge fees for DMPs, which make them more palatable to creditors, and they have a good working relationship with most creditors. Chances are they won't embroil your utility supplier as well.

I have heard of utility companies asking you to swap out onto a pre - payment meter during your iva when debt is included in your iva.
A friend swapped utility companies ahead of their IVA to avoid this from happening however during the transaction to swap over, the outgoing utility company informed the new provider of the debt and it had to be settled prior to swap over or go on pre-payment with new supplier.

I echo Foggys advice in getting a second lot of advice from Stepchange to see if a DMP is more appropriate in the interim.

Just bear in mind that a Debt Management Plan will tarnish your credit record in the same was as an IVA, just want to be clear on that. Also just to add that, if you have a 4 year fixed mortgage that will take care of most of the term of the IVA. After that you may be able to get your lender to do a simple 'product switch' without creating too much attention. If not then your IVA contributions should be adjusted accordingly.