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By Inkpen
I am on a debt management owing a sum of 130000with about 15 creditors.I would like to know please if I can enter an IVA .Also I work for the NHS and contribute for a pension.Kindly advise me if I enter an IVA,will it be likely that my pension contribution will be affected.

By the way, I am paying the debt management company £430 pounds per month and after that I have to struggle.Recently I have received a county court judgement and I have been ordered to pay the full amount or by instalment.However,the inslament plan is very too high and I have send it to the debt management company.
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By Andrew Graveson
Hi Inkpen,

A couple of questions that might help the on-site experts to let you know whether an IVA will be viable:
Are you a homeowner?
If so do you own the home alone or jointly?
Is there any equity in your home?
Is £430 the maximum that you would be able to pay towards the debts?

If your pension contribution is reasonable I don't think it would be affected.

I'd suggest caution regarding the payment ordered by the Court. Failing to make the payments could lead to Charging Orders, Attachments of Earnings or even visits from Bailiffs. If you feel that the monthly payment amount set by the Court should be lower you should obtain form N245 from the Court Service website and make an application to vary the amount. If you have handed this to your debt management company to handle I'd suggest keeping a close eye on them to make sure it is being dealt with prompty and properly.
By Inkpen
Hi Andrew

Yes, I am a home owner. I have a joint mortgage with my wife. There is about £60k of equity in the house I think but its not easy to know with the current state of the house prices. In terms of the amount I am currently paying to my debt management company, I might be able to increase this to perhaps £500 per month but not much more.

Thanks for your help. Any advice is really appreciated.
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By Steve Jackson
Hi there Inkpen and welcome to the forum.

Given that you have debt of £130,000 and are a home owner, the IVA solution is ideally suited to your situation. If you had no home equity, you might have struggled to do an IVA based on the fact that your disposable income is too low. You would need to pay around £650/mth to make the minimum contribution required by your creditors with monthly payments only. However, given that you have equity in your home, you will be able to make monthly payments and then pay a lump sum into your IVA at the end of the arrangement based on releasing equity from your property. This is a standard way of making an IVA work.

The way your pension contributions are dealt with will depend on the type of pension you have and your age. Generally if you are 55 or over, your creditors will allow you to maintain any reasonable personal pension contributions you are making. However, if you are younger, you may have to reduce the contributions if you are able to do this within the terms of the plan.

As Andrew says, if you have received a county court judgement (CCJ), you have done the right thing by passing it to your debt management company. However, the only way you can change the payment terms is through an N245 application form. However, if you do carry out an IVA, this will overturn your CCJ and you will not have to worry about it.