What’s An IVA?

Home improvement loans are a total no no for me. There is nothing in this world worth getting yourself in debt for.

Rather than increase the money outstanding on my home, I am desperately trying to pay my mortgage off quicker than it should be. The money that I will save In interest far outways any home improvement that I could possibly make to my home to increase its value.

I make regular overpayments, hope to pay off my mortgage 10 years early and save almost forty thousand pounds in interest. If you can beat this by borrowing money to improve your home then I would love to hear what great plan you have to do this, as I am not sure there is anything more profitable than what Im doing.

It took me a long time to be debt free and the though of borrowing more cash that I can ill afford to pay back makes me entirely queasy.

Borrowing money on your mortage to improve your home is absolutely worth it.

You cant take the money with you when you die and while your going around the track for the first and only time, you may as well make the most of it and live a comfortable and happy life with a nice home, stunning conservatory, nice garden, three point two children, a dog and a suite in a range of matching fabrics.

Why you should you not treat yourself to that extra bedroom, or the ensuite bathroom that you have always dreamed about. And, if you kick the bucket tomorrow your life insurance will kick in and your spouse wont even have to pay it back.

I say go for it, live life to the full, thrown caution to the wind and lay that new wood floor, or restore those old doors, or knock down some walls. Whatever surrounds make you happiest you should have and if the bank wants to give you the money then my vote is yes.

One of the worst things is to hide debt from your partner.
being in debt is one of the most stressful things to cope with and trying to deal with it on your own and trying to hide it from a partner is bring about even more stress.
My partner and I were in debt for a long time due mainly to the usual things of enjoying the good life, then buying a house and starting a family.
the harder it got and the more we struggled the further apart we grew, I had also run up additional debts to the ones we have jointly.
I tried to deal with these on my own as I didn’t want to worry my partner even more, but the more I tried and was failing to deal with these the more our relationship floundered.
I did eventually tell my partner about my additional debts, he was shocked and quite angry not just about the debts but the fact that I felt I couldn’t tell him.
we are now dealing with this together and while its hard and its a struggle we know we have each other

We live in an age where there are so many opportunities to buy things and infinite businesses fighting for our custom. It can be difficult to say no to things we’d like even as an adult, so what chance does a child have? The answer rests is in the way we control and educate our children.

Don’t spoil your children by buying them everything that they want as they will always think they can have anything. Every parent wants their kids to have the best, but buying things to make yourself feel better because you are divorced is not the answer. Analogously speaking, it is like constantly feeding a hungry, obese dog. You think you are being kind but you are really killing it.

Be generous to children with your time and affection, not your money. Time is the most precious commodity we can offer anyone. Your children will not love you just for buying them things, they will grow to resent you and take you for granted as they get older. They will also damage their lives because they have no understanding what money is and how hard it is to come by - until it is too late!

The deterioration of my relationship began with the lies my ex told about spending on store cards. We had initially used a card together to purchase a TV, and by my insistence, stuck rigidly to a payment schedule. We had paid for the item in full before we ever paid any interest. But my ex picked up other store cards in his own name and spent on them as if it was going out of fashion. The arguments began. I have no idea how bad it got for him, but after left me, I was always getting calls from the card companies. I thank my lucky stars it was never a shared debt.
My mother struggles with debt now, and that causes arguments between us too. Every so often she struggles with getting more credit. She’s tearful and angry, believes she could lose her house and swears she will change. She asks me for help and I never know what to say. She just spends too much on luxury items, but pointing that out causes more rows. Eventually she finds a way forward, but soon lapses into the old habits. ‘I’m not going abroad this year’ is a vow that fell by the wayside very quickly. She rang me up to say she’s booked a holiday to Greece. I said OK. What else could I say?
Debt is so destructive. Watching the way it affected my parents as a kid changed my life. My aunt sank into depression after running up credit card debt and warned me off them from the age of 13. It’s caused a terror of debt that in some ways has protected me, but in other ways scared me off any manageable amounts and maybe limited me from making the most of some opportunities.
Telling the truth about debt is essential. To your closest relatives and friends, but to yourself too. The head in the sand approach will get you into trouble very fast.

It’s so easy to get into debt! At 36 years old, I have had some form of debt since being a university student, with an overdraft and a student loan.
My first ‘proper’ job opened up more avenues for ‘debt’. Though to my mind, I had more money than I had ever had before so putting something on a credit card to pay off was not a problem.
This said, I have married and had children and I lose count of the times we have ‘consolidated’ our debts or remortgaged and extended to cover debts.
Credit is far to easy to obtain and far too easy to get into trouble with.
I now have one credit card which I use to obtain bonus ‘points’ and I pay it off religiously each month. In fact, I have kept a low credit limit and usually make a payment every week so I know where I stand.
Stresses within the family - we have had hard times where we have been unable to make repayments. We also have the reverse where one of us talks the other into buying something ‘on credit’.
If i could go back in time, I would seriously consider the way we spend. We are making changes now, but we are still left paying for what we spent in the past.

When struggling with debt it can appear that there is no way out and no one to turn to for help. After you have cut back and tried to reduce unnecessary outgoings things are still tight, let your lenders know.

Communicating with your lenders when you’ve hit trouble will enable them to work with you to repay the debt in a more manageable way. They may be able to reduce the minimum monthly repayment.

If this isn’t enough to help you can contact a non-profit debt advice organisation such as the citizen advice bureau or the national debt line. When getting advice go to a fee free organisation that is non-profit and in dependant. The last thing you want is another company trying to flog you their latest product. These independent organisations will be able to advise you best for your circumstances and help you to rectify the financial problems you face.
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Firstly an IVA (Individual Voluntary Arrangement) should not be taken lightly, an IVA will have a negative impact on your credit record for at least 5 years, you will be unable to obtain credit and you may be able to remortgage your home but it will be at a much higher interest rate then normal. You may be asked in the final year of your IVA to remortgage your home to release the equity so as to pay a lump sum to your creditors.

Now you have and idea of what you’re getting into, here are the reasons why an IVA is more flexible.

With an IVA the fact that you have entered into one is not released publicly. An IVA allows you to repay a percentage of what you owe to your creditors at an amount which is more affordable.

You get to keep your home, generally in bankruptcy proceedings any assets you have including your home and car would have to be sold to pay your creditors. An IVA won’t threaten your career if you are working in a profession, where becoming bankrupt means that you could lose your license or your job.

Please remember deciding which avenue to take that you should always seek advice from a not for profit financial advice organisation such as the Citizens Advice Bureau.

IVAs have become increasingly popular over the last few years. They are advertised extensively on TV as an easy solution to a person’s debt problems.

An IVA is really only an option if you owe in excess of £20,000 due to the fees imposed by the insolvency practitioner you are legally obliged to have. In order for an IVA to be accepted you need 75%, in terms of debt liability, of your creditors to vote in its favour. It doesn’t matter if they don’t all vote as it only takes into account those who do.

There is no doubting that an IVA has many advantages. Amongst these is that you can keep your own home, maintain your professional status (for example, if you are a member of the police force or an accountant) and your insolvency isn’t made public.

An IVA should be considered as a potential solution to a person’s debt problems, but it is a long road to financial freedom. Whilst you will usually be released from bankruptcy after 12 months an IVA lasts for 60 months. If you fail to keep up with your payments the funds you have paid in will be used to pay for your bankruptcy.

Please ensure that you seek FREE financial assistance, from Payplan or Citizens advice, before making a decision regarding whether this is the right option for you.

An IVA is more flexible than bankruptcy for both the debtor and, less often commented upon the creditor. The debtor’s assets come under less threat during an IVA than bankruptcy. Assets are seized during a bankruptcy and this does not happen although you may still be required to sell some of your assets to keep up with the payment plan. Most importantly if you run a company your company can continue trading and you can remain as the company director. The same applies if you hold a job; you do not have to inform your employer. This means that you can retain control and privacy for your finances rather than having everything taken over and laid open by the courts.

For the creditor an IVA is also more flexible. To start with the fees are less. However more importantly a forced sale of assets which occurs during bankruptcy will often not achieve the highest price for the assets, this means that creditors will often regain a larger amount of the debt during an IVA. The IVA was introduced in 1986 and is considered by many as not only an alternative to, but also a step before bankruptcy.