A little bit of advice needed

[leggylegro]

Myself and my husband are currently in a Debt Management Programme with Gregory Pennington - have been since Feb/Mar last year. The programme was recommended because at the time my husband was self-employed.
Since we did our last review with GP they have been pushing for us to go onto an IVA as my husband is now employed. I myself am not keen but my husband wants to go for it. The big selling point to him is that the debt will be paid off in 5 years rather than the current 12 years GP are saying if we stay as we are. I have explained to GP that I will be able to increase the payments when my youngest son starts nursery in September as my childcare costs will drop. They would still like us to go for the IVA and can't understand why I don't want to.
Our current financial status is as follows:
£64,000 mortgage (with West Bromwich Building Society)
£21,000 secure loan
£25,000 un-secured debt (this is what GP are dealing with)

I'm just after a bit of advice really to see what people think and what would they do.

[aguise]

Hi there
I know someone who was with gp and they paid into a dmp for two years and the debt was not dropping, gp did the sdame and they now have an iva and pay less than the dmp. I know they pass it to Freeman jones which is their sister company and I have an iva with them due to good report from the friend previously mentioned and I cannot fault them at all. I have done a review on iva .com if you want to look. I am not saying to go with it but just am saying as I find. The iva is the best thing that we could have done short of bankrupcy which would have given little to creditors but was an option as we only rent and have no assets. Just to confirm childcare costs will be taken into account and then when they stop the iva payment will increase this would be normal. I would at least look into it as your husband says five years is better than twelve and with the dmpo you are still getting inbteresty and have no creditor protection.

Hope this helps.

Ang

[aguise]

Sorry about the rotten spelling, also ours is a joint iva as such one payment for both of us.

Ang

[leggylegro]

Thanks for that. My husband spoke to Freeman Jones today. There are a few reasons why I'm not keen on doing the IVA but the main one is the company I work for have just taken over another company so there are now 2 of everyone doing the same job. At the moment I don't know whether I will be made redundant or not. Also my husband comes from Lancashire and every week he travels from Bham up there to see his daughter. Would the IVA take this extra mileage etc into consideration?

[Adrian Ratcliffe]

Hi leggylegro,
Your husband is right about the selling point, what equity do you have in the property ? as you will be asked to release some of that equity in the 4th year.
I have a single IVA and this works well as I made most of the debt through being self-employed and buying houses etc to rent out.
Don't get rushed into it and use this forum for a couple of months to get a feel of how it affects different people.
You will be surprised.

Regards
Adrian

[Adrian Ratcliffe]

Hi leggylegro,
Melanie Giles is the one to ask but I don't think the extra mileage would be taken into consideration.

Regards
Adrian

[aguise]

Hi there I think they would you should ask them. I wrote down all the things I didnt understand and when the rep came to see me I asked every single one and there was two pages. I understand your nervousness if your job is not secure what do freeman jones say, you can have redundancy cover and this comes off the payments but not sure that would help as you would already be aware there could be a problem and as with a lot of policys you have to have it a certain length of time to be able to claim. Have they estimated your payments and if so how do they compare to the dmp if they are less then you cannot lose regardless of your job.

Ang

[leggylegro]

The house is worth about £85,000 - £88,000 if we're lucky. So there's very little equity and we've just changed to an interest only mortgage fixed for 5 years so that the monthly payments drop a little.

[Adrian Ratcliffe]

hi,
The less equity the better from my point of view.
Did you take advice on the Interest Only (good move)
5 year fixed is a good deal.
Who is the un-secured with?

Regards
Adrian

[leggylegro]

We have a very good mortgage advisor.

The un-secured debt is made up as follows:

Halfax loan - £12,000
Barclaycard - £2,300
Halifax credit card - £3,500
Woolwich loan - £5, 800
Woolwich overdraft - £1,500
Look Again catalogue - £2,500

The Woolwich loan is now with debt collectors and I came home tonight to a letter from Halifax saying that the loan has been passed to debt collector's as well. My husband also has just under £1000 Halifax overdraft which is being paid off seperately from the DMP at £100 mth.

[MelanieGiles]

Firstly I find it strange that you were put into a DMP in the first place! IVA's were made for people who are self-employed, and to be advised not to do one because of that seems bizarre to me if that was the only reason.

Your husband's mileage to visit his family would be allowable in the IVA - just make sure that whoever you choose to represent you takes this into account.

An IVA would appear to conclude your debts at a much earlier stage than the DMP you are currently paying into - it would be interesting to see exactly how much your debt has reduced over the previous two years, to give you some idea of how long it would take to pay your creditors off in full.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[Adrian Ratcliffe]

hi,
You have nothing to loose.
Melanie will be on here shortly she is the expert.
The debt collection agencies are nothing to worry about, if you opt for the IVA they won't even contact you.
The fact that you have secured a good deal with your mortgage leaves you with better options, I would be very picky about who I used for the IVA.

Adrian

[leggylegro]

Adrian/Melanie

Thank you for your response's. I am going to talk to Gregory Pennington tomorrow to find out how much the debt has reduced by.

[Adrian Ratcliffe]

be nice to know how you get on please keep intouch.

Adrian

[aguise]

Hope things are a little clearer.
All the best Ang