Questions you have before making a decision to go Bankrupt and the Bankruptcy process

Moderators: TalbotWoods, JaneClack

By knight1066
#2395 Hi All.
First time here,any advice welcome.
I am currently 18mths into an IVA and starting to struggle as my payments have gone up due to wage rise etc,no spare money at the month end and dreading another 3.5 yrs of increasing payments.Has anyone advice ? ie would Bakruptcy be a better option than IVA?
Thanks All.
ByDavidc
#2396
knight1066 wrote:Hi All.
First time here,any advice welcome.
I am currently 18mths into an IVA and starting to struggle as my payments have gone up due to wage rise etc,no spare money at the month end and dreading another 3.5 yrs of increasing payments.Has anyone advice ? ie would Bakruptcy be a better option than IVA?
Thanks All.

Are you a house owner or do you rent?
Have you chosen the IVA to protect any assetts?
Are there restrictions career wise regarding bankrupcy?
Do you have any immotive feelings regarding bancrupcy which constrain you?
Is there no way you can forcee continuing the way you are within your IVA for another 3.5 years? or is it going to fail anyway and you will have to go down the bankrupcy route anyway?
David
By knight1066
#2397 Thanks David.
I am in rented accomodation and have no assets.My job would not be affected , can bankruptcy be any worse than Iva ?,in the Iva my payment increases if i work overtime,payments seem to increase every 3 months so now cant work any extra.I can still make the payments but thought B was maybe the shorter time scale to get out of my problem?
Cheers.
ByDavidc
#2398
knight1066 wrote:Thanks David.
I am in rented accomodation and have no assets.My job would not be affected , can bankruptcy be any worse than Iva ?,in the Iva my payment increases if i work overtime,payments seem to increase every 3 months so now cant work any extra.I can still make the payments but thought B was maybe the shorter time scale to get out of my problem?
Cheers.

Given your circumstances I see no advantage in you continuing in an IVA which based on what you say is destined to fail anyway. One wonders who advised you to go down this route. Let me guess......a fee charging IP.....
Let us list the the pro's and cons...
IVA: Paying all of your exess income into an IVA for the next 42 months

Bankrupcy....Paying 40-50% of your exess income for the next 36 months.

IVA: Strict limits on personal expenditure

Bankrupcy : usually more generous with what they will allow.

IVA : credit record shot for the next 6 years.

Bankrupcy: Same

Bankrupcy listed in public notices in local paper.

Bankrupcy: Bank account frozen and closed. Have to open new account.

My advice . Why prolong the agaony get it over with asap. Stop paying into the IVA and get the £450 together and go for it.
David
By knight1066
#2399 Thanks Dave.
I will look into this in depth now,thanks to your advice.
Took advice from a company who suggested IVA,not a million miles away from this board!!!
Thanks for help.
ByDavidc
#2401
knight1066 wrote:Thanks Dave.
I will look into this in depth now,thanks to your advice.
Took advice from a company who suggested IVA,not a million miles away from this board!!!
Thanks for help.

Well they have made their money. Doubt if your creditors have got much out of it yet...... fees come first........time to do the best thing for yourself.
David
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By JaneClack
#2427 I would just say that when you went into the IVA the situation would have been bankruptcy for two or three years but from April this year it is only one! This should have been explained and it should have been emphasised when you read through and signed the R3 leaflet as everyone has to do. Yes, David is quite right you do have nothing to lose now and I am sorry you have let it go on as long as this but I would say, however, that no-one can second guess an official receiver and I have seen them want as much as 90% of perceived surplus income (not as much as in a VA generally as they are more generous with the income and expenditure than creditors are) and they have to be let know within 21 days of any change in cirucmstances for increases in any IPA - which you would certainly have if you can afford an IVA. The OR himself might suggest a fast track IVA but unlikely I have to say. The IPA would last for three years so as you are on the cusp as it were(with only 3 and a half years to go) take advice from your case officer as there is six months difference here. Tell them you are struggling but if you cannot make the payments you have no choice anyway. Call your case officer and let them know of your concerns.