We have amassed a total of 90k of debt spread across 4 loans and 7 credit cards. Our monthly payments on these now exceed 1700. We are 300 short each month after paying all houshold bills. We are borrowing from one to pay another and this will only last another 2 months.
I have done a debt remedy with step change and been researching IVAs and think that this is our only option. I also feel that this is the wake up call and lifestyle change we need.
Do I start defaulting on minimum payments now? Most are due 1st Feb. They would be paid using overdraft facility. Would this be a negative or positive in our IVA application? So far we have kept above water and met all payments.
I don't know what to do foe the best.
Welcome and well done on taking the first step in addressing your debt.
You need to start taking some advise from insolvency teams to ensure the iva is the right option over say bankruptcy. Talk to 2 or 3 companies and then agree to go with one and have a solution proposed to creditors.
Once it has been proposed stop making payments to creditors and use this time to build a small contingency with the money you are then saving from not paying your creditors. Creditors know that once an iva is proposed monthly payments tend to stop.
Where possible maintain your household expenses such as mortgage, utilities and council tax - stop the credit cards and loans. You need stopped all rather than some as you would not want to be seen treating one differently.
Good luck and let us know how you get on.
Sharing from experiences of dealing with debt
There is a solution for everyone .... Just need to stay positive !
I echo Luluj's advice. Chat to a couple of firms -- to get a feel for how they operate. Make sure you are really happy with the allowances they give you going forward and start the ball rolling. When you have made a firm decision to proceed and the IP is happy to put the proposal forward then you can stop unsecured loan payments.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Also get a new bank account that is not tied to any of your creditors before you start the process.
We got a basic bank account set up with Nat West
Good luck
Today 1st of December 2016 the vultures finally flew away
Co-op are also recommended for a bank account. Has to be set up on the phone or in a branch.
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
