What do I do next?

[karen wills]

My husband and I applied for IVA's and the adjourned meeting was held today. Two out of the three creditors approved and the other one rejected. In effect my IVA went through but my husbands didn't. Accuma said that I could go ahead with the IVA but my husband would not be able to.

In considering this I am trying to understand how this would work. We have one creditor each and one joint loan so three debts in all. Nat West who we have the loan with have voted for the IVA and so have my credit card Capital One. My husband's credit card MBNA turned him down. We could only get 70% votes in favour.

If our NatWest loan is part of my IVA does that mean I would be responsible for the IVA payment and my husband wouldn't have to pay anything extra to Natwest and he would just have to find extra money for MBNA?

I am trying to work out whether it would be better to go for this option so at least the majority of the debts are being reduced and bound by an IVA and my husband would just have to come to an arrangement privately with his credit card.

Have spent a lot of time worrying over the last few months and am very disappointed that we did not get a joint IVA. Any advice gratefully received.

Karen

[Adam Davies]

Hi
The reality is that you would have pay the Natwest loan as part of your IVA and your husband would have to pay also,or come to some type of agreement,as you are both liable for the full amount.
You need to assess whether you can pay your IVA and your husbands MBNA card and Natwest[hopefully an agreed reduction].
Has your IP stated MBNA reasons for rejection ?
Regards

Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

[karen wills]

The amount of my IVA was to include the Nat West loan so would it not be the cost of my IVA plus a payment to my husband's credit card or would he have to pay extra again to Natwest separately. I thought perhaps that because Nat West have accepted the IVA that as long as they are receiving the proposed payment they would be "happy".

Accuma said that the reason MBNA rejected was because they prefer people to deal with them directly to sort their debt problems out.

Karen

[MelanieGiles]

i am rather suprised that your case was put forward as as IVA, as you and your husband only have two creditors each and this does not really fit current IVA criteria, so I can see why MBNA have rejected. If you decide to go ahead with the IVA, as Andy says your husband will still need to deal with the joint Nat West debt using his disposable income outside of an IVA - possibly via a Debt Management Programme.

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

[karen wills]

Our debts in total are approximately £50,000 and Accuma said that this would be suitable for an IVA. They did mention that MBNA are very against IVA's - is this correct? It is very disappointing that we were so close to our IVA going through and then it didn't.

The disposable income that we put forward in our IVA is our joint disposable income so how would the bank view my husband trying to make payments on top of my IVA? Essentially he could make a small extra amount to his credit card but he would be unable to pay any extra to Nat West. I don't really know the best thing to do now, whether to write to all our creditors with proposals of amounts along the same line as the IVA or to try and do the IVA myself and see if the Bank would accept nothing from my husband and a small amount to his credit card. I would appreciate any advice, I don't seem to understand where I go from here.

Karen

[MelanieGiles]

No - I don't think it is fair to say that MBNA are very against IVAs, but I would not have put a case forward which only had two creditors.

If you decide to go ahead with your IVA, I assume that your IP will at least have prepared individual income and expenditure accounts, so you will need to see if your IVA can stand up alone on the basis of your own surplus and still achieve the dividend pledged.

What have your own IP's reommended to you, and have the creditors meetings been adjourned in the meantime for you to give the matter further consideration? And also have you considered entering into a Debt Management Agreement which may be more appropriate for your circumstances.

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

[karen wills]

They haven't advised me on what to do next, they just said they would return my cheque and they were sorry they didn't get the right result. The meeting has not been adjourned.

They prepared our income and expenditure on a joint basis. They just said that I should now write to my creditors with proposals along similar lines to the IVA.

I am very worried as when I spoke to Nat West yesterday they said if they voted against the IVA they would just put a charge on our house straight away without referring back to us. I had thought that as long as we are willing to pay (which we are) and write to them with proposals they would consider these and not take any drastic action against us.

It is always quite difficult to get hold of people at the company. I haven't ever spoken to the IP who is named on the proposal, I always speak to someone in Creditors Liaison, which I presume is normal.

Karen

[MelanieGiles]

Hi Karen

If an IVA is no longer an option for you - and to be frank I feel that this was always going to be rejected by MBNA, then you will need to consider whether bankruptcy proceedings are now a better option or a Debt Managemebt Programme. What has the IP done about your IVA which was accepted? have you been given the opportunity to go ahead on your own, or do you feel that this is not viable without the support of your husband.

Your case seems a little muddled. I suggest you contact your own IP directly on Monday to see what they have to suggest.

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

[karen wills]

They haven't told me what they have done about mine. Bankruptcy is not an option as it is a condition of my employment that I am not made bankrupt. My husband is a driving instructor and it is a condition that he is not made bankrupt.

I will call Accuma on Monday and see if I can get some guidelines as to what I should do/what are my options.

Could you just tell me whether as long as I follow suggested standard letters to my creditors whether I have the same chance in having a DMP accepted if I propose it as opposed to using a company to do this? Thanks for your replies.

Karen

[MelanieGiles]

With only two creditors, Karen, I feel that you have a good chance of making an offer directly to your creditors - but at the moment you appear to also have an IVA available. Has the IP confirmed that your IVA was rejected - when was the creditors meeting, and have you received a copy of the Chairman's Report? And what do you do for a living? Could you also explain why bankruptcy would affect your husband's employment? Are you worried about the publicity of a bankrutpcy affecting his earning ability - is he self-employed?

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

[karen wills]

My IP just said that the two creditors that appear on my IVa voted in favour so she said I could go ahead with mine. She didn't really go in to any options.

The creditors meeting (adjourned from last week) was today and I have not received a copy of the Chairman's Report. I work at a firm of solicitors and it is a condition of my employment contract about not becoming bankrupt.

My husband is self employed but one of the conditions of being an ADI is that you are not allowed to be bankrupt, I suppose it is to do with handling money etc.

Karen

[MelanieGiles]

Hi Karen

Can I ask what figures you both put down for earnings in your IVA, and what disposable income you were offering to creditors. If you could also post the amount you owe to each creditor, then I can try and have a stab at the effects of one of you staying in the IVA and the other perhaps doing a DMP.

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

[karen wills]

Hi Melanie

Thanks very much for your post. I set out below the details requested:-

Salary (Karen) £1340
Part time income (Karen) £300
Drawings (Roger) £294
Other income £160 (board from daughter)

Total income £2094

Expenditure £1,769

Surplus for creditors £325

Amount owed to creditors:-

Natwest (joint) £25,352
Capital One (Karen) £12,214
MBNA (Roger) £12,327

Karen

[MelanieGiles]

Hi Karen

As you actually earn 82% of the household income, you ought to pay 82% of the shared expenditure, which leaves you persoanlly with a surplus of £275 per month, which enables you to make an offer of settlement to your two creditors based upon a 25p in the £ dividend. This leaves your husband with £50 per month to deal with creditors totalling £37,679, and I do not feel that this makes a DMP viable for him.

I suggest that he looks further into whether bankruptcy proceedings would affect him terribly - perhaps he should contact his personnel or welfare department.

And just an observation that if your husband is only earning £274 per month, is it really worth carrying on in this professsion? Shelf stacking in a supermarket would earn him more money for working less hours.

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