IVAs and DMPs are very different debt solutions.
Neither of them is best for everyone. It depends on your current situation and how that might change in the future. Looking at the differences between IVAs and DMPs is the best way to decide which is right for you.
Most IVAs follow a standard pattern and that is what I am describing here.
NB If you owe less than £50,000, you don’t own a house and you have little money each month for your debts, have a look at a Debt Relief Order (DRO)instead. A DRO is always better for you than an IVA and usually better than a DMP.
Contents
DMPs are good temporary solutions – IVAs aren’t
You can easily change a DMP to pay more or less. Or to switch to a form of insolvency if things go badly.
You can end an IVA by failing it or by settling the debts. But the IVA can be difficult and leaves you back with all the debts and an insolvency marker on your credit record. And settling the IVA early will not remove the insolvency market, even if you pay all the debts in full plus the IVA fees.
making a choice: If there is a good chance that your finances will improve soon you probably should choose a DMP. If your finances improve in an IVA you will have to pay a lot more each month into the IVA and it doesn’t end any sooner.
If you think your finances may get worse (because of the cost of living, your mortgage increasing when the current fix ends, your relationship not being secure, your job not being secure, having another child etc) then an IVA may fail. DMPs are much more flexible, see below.
An IVA has a guaranteed end-point – a DMP hasn’t
IVA normally end after 5 years, with an extra year being added if you have equity in a house but can’t release it. At that point, your IVA is completed and any remaining debts are written-off.
But some IVAs go on for much longer than planned. Some last for more than seven years or moe because people needed payment breaks or when they thought they had got to the end a review showed they had to pay in extra money from overtime or bonuses.
A DMP goes on until you stop it or you have cleared all of the debts. This could take three or four years, but it could still not be finished after twenty! When you are choosing between an IVA and a DMP, you must work out how long your DMP is likely to last, this is a crucial piece of information.
You may know your situation will improve after a few years – when childcare costs end, or when the car finance is finished:
- here a DMP may sound very long at the start, but then you will be able to increase the payments to it and finish it a lot earlier!
- in an IVA, your payments will just increase at that point and the IVA won’t end sooner.
There are other ways to speed up a DMP to – making affordability complaints early in the DMP and making settlement offers later on . These don’t work in an IVA.
making a choice: If your DMP is going to be very long, then an IVA instead could be a speedier solution. But think about the ways you could speed up a DMP.
Many IVAs fail as their payments aren’t flexible – DMP payments are
In a DMP, repayments are flexible. They can be cut if your hours drop or you have additional expenses. The downside of doing this is that your DMP takes even longer to complete.
In an IVA, if things go wrong there is limited flexibility built-in. Payments can be decreased by 15% or there can be a payment break of nine months – see What happens if you can’t afford the IVA payments.
But large problems, especially in the first few years of an IVA, may mean your IVA fails, leaving you back with your debts. Statistics have been complicated by long breaks over Covid, but it seems likely that about a quarter of IVAs at the moment may fail. And many more only “succeed” because a desperate borrower has to ask a relative to settle the IVA for them.
making a choice: If you have a very variable income, making a five-year commitment to an IVA would be unwise.
If you have a regular income, now and your job feels secure, are any of your expenses are likely to change significantly? Increase in your mortgage, need a new car, or have another baby, or will your benefits stop when a child leaves school? These may mean that an IVA isn’t a good option.
A DMP pays debts in full, but some are written off in an IVA
So not having to pay all the debts sounds like a big advantage for most people, except for those who would prefer to repay all the debts.
But the write off amounts you are told of at the start of an IVA aren’t guaranteed. If your income goes up you may end up paying a lot more, so the write off may end up very low. If you get a good redundancy payout or inherit money, you may even have to repay all the debts in full, plus the IVA firm’s high fees.
And although write offs aren’t part of an DMP, they are actually very common when you are in a DMP:
- winning an affordability complaint writes off part or all of the balance that went into the DMP
- when a debt is sold to a debt collector, the debt collector paid very little for it and may accept a low settlement offer which has the same effect as writing off part of the debt.
An IVA has to be agreed by a majority of your creditors – DMPs don’t
An IVA has to be approved by 75% (by the value of their debt) of creditors who vote at the meeting. If you have one very large creditor, they effectively have a veto over the IVA. For example, a large creditor may say they will only accept a proposal if it is for six years not five.
A DMP isn’t voted on by your creditors so it can’t be rejected.
Interest stops in an IVA – this usually happens in a DMP but it isn’t guaranteed
All your creditors in an IVA are bound by the IVA. They can’t add more interest, even if they voted against the IVA.
In a DMP, creditors are asked not to add new interest or charges. In 2025, the vast majority agree.
Most of the cases I see now where interest hasn’t been stopped have been an admin error by the lender and when you complain, the lender will likely remove the interest added.
The Financial Ombudsman has upheld some customer complaints where a catalogue or credit card hasn’t stopped adding interest.
making a choice: If other factors are pointing towards a DMP, you could start a DMP and 6 months later change to an IVA in the rare event that you have problems with creditors continuing to add interest or charges.
An IVA can feel more intrusive than a DMP
An IVA has to be set up by an Insolvency Practitioner, there is no “DIY” option. You will have to supply your Insolvency Practitioner with a lot of details and paperwork before your IVA is set up. They will ask for copies of your payslips and bank statements at the annual IVA review and at the end of the IVA.
An IVA is also a matter of public information – your name will be on the Insolvency Register.
If you set up your own DMP (see this article that can help) you don’t have to discuss your affairs with anyone else, but you will still have to send your creditors an Income and Expenditure Sheet to persuade them to freeze interest.
If you use a company to run a DMP for you (NB never use a commercial firm that charges you fees!) then you will have to talk through your budget with them at the start and at reviews, but it will be simpler than setting up an IVA and less intrusive.
making a choice: If you need the security of an IVA, these are the inevitable side effects. For most people, they won’t seem like a major factor in making their decision.
Safeguarding your house
In an IVA, your creditors cannot take legal action against you: they can’t get a charge over your house or make you bankrupt. For the duration of the IVA, your house is, therefore, safe. (Assuming of course, that you can pay the mortgage and any secured loans.)
In the last year of an IVA, if you have significant equity you may have to remortgage or get a secured loan to release some money for your IVA. People in an IVA have been are asked to take out secured loans at horrifying rates of interest instead of a remortgage, in 2024 12-15% was common, see this story of one person being offered a 15 year secured loan at 19% interest.
In a DMP, creditors can theoretically try to get a charge over your house or make you bankrupt. This is very unusual for a consumer debt, especially at the start of a DMP. It is more likely to happen where you have given a guarantee or for business debts. If you are concerned about whether this is likely to be a problem for your DMP, it might be helpful to discuss it with StepChange.
making a choice: protecting a house with significant equity is one of the main reasons to prefer an IVA over bankruptcy – but possibly having to take out a secured loan at a high rate of interest in the last year on the IVA is a massive problem for homeowners.
Many people worry more than they need to about the very small risk to their house in a DMP.
Effect on your credit record
An IVA is a form of insolvency and has the same bad effect on your credit record as bankruptcy. The IVA marker on your credit record will remain for 6 years or until your IVA is completed – many IVAs take much longer than 6 years as people have to take payment breaks that extend the term of the IVA.
The IVA marker remains even if you settle your IVA early or repay your debts in full. It creates difficulties:
- if car finance ends during your IVA. See IVA and car finance for details.
- it makes it very hard to get a new private tenancy without a guarantor.
- when you need to remortgage during your IVA.
- even when the IVA has ended and the marker has gone, you are still normally asked in a mortgage application if you have ever been “bankrupt or in an IVA” or if you have ever been “insolvent”.
The effect of a DMP on your credit record is not so bad but it’s more complicated as there is no definite time at which creditors have to mark debts as defaulted.
In a long DMP it’s better if debts have defaulted because then they fall off your file after six years – see this article for more details.
making a choice: The impact of an IVA is worse for your credit record than a DMP. This is a side effect of your chosen debt solution you should be aware of… but it is less important than other factors such flexibility or the length of time until you are debt-free in deciding which is best for you.
Summary
IVAs are formal legal contracts. They have a fixed duration and all creditors are bound by them which is good, but they are not easily changed. You must be sure you can live on your allowed budget and that you think what may change over the next few years. Do not rush into an IVA and later regret it.
DMPs are an informal debt solution. They can be short or long-term. Creditors are very likely to freeze interest. They are flexible so you can change your payments.
This is a really hard choice to make:
- an IVA that fails or ends up with a high cost secured loan is a disaster and too many of them do.
- being stuck in a seemingly endless DMP isn’t a good idea either.
You may feel that you need a crystal ball because of all the things that could change in the future! If neither feels right for you, look at the other possible choices such as a debt relief order if you are renting, bankruptcy, selling your house, getting a lodger, etc.
If you are feeling completely stuck, you could start with a DMP and review it after 6 months, when it will be clearer how you cope on a restricted budget and whether your creditors have frozen interest.
Change from an IVA to a DRO?
Choosing between a DRO and IVA or DMP
Ed says
I’m feeling stuck I want to repay everything but I’m always in my overdraft and my last card is close to the limit and I’ve rejected for a balance transfer. I my lose my job in the next year that looks likely. I need low payments now don’t mind how long for what is best for me? Are iva payments lower?
Sara (Debt Camel) says
IVA and DMP payments are usually about the same. But in your situation where you think your job is at risk you should NOT go for an IVA, because it may fail if you lose your job and can’t get another one paying as much. I suggest you talk to StepChange – they can set up a DMP now for you if one is suitable.
They also do IVAs, so if later the risk of losing your job decreases or you do lose it but get another one, you could switch over to an IVA when it is safe if a DMP will take too long.
S says
hi.. Not sure if this is the correct thread… I am in discussion with Payplan in regards to entering into an IVA ( after wasting 3 months dealing with Creditfix .. who were not very helpful)..
One of our debts is a Child TAx Credit Overpayment from 2013/2014.. back in 2014, HMRC sold this to a debt company, and after i showed them our income and expenditure and our DMP with Stepchange ( now ceased), they passed the debt back to HMRC with the commentary of no possible means of payment on this debt. We heard nothing in 2015, 2016, 2017, but we received notfication that the debt is still valid in 2018.
i have since read “Following a House of Commons Public Accounts Committee report, HMRC has decided to no longer pursue collection of tax credit overpayments in the following circumstances:
“Overpayments made between 2003/4 and 2008/9 for which HMRC have either received no payment in the past 12 months, or where the individuals cannot be traced.”
Our understanding is that the debts will not be written off, just not pursued.
does this only apply to the period mentioned, or extended to other timeframes..
I am trying to avoid an IVA but need to ensure on certain criteria before finalising this decision. If the HMRC debt will “not be pursued” as mentioned above then i will possibly go with the DMP
thanks
Sara (Debt Camel) says
I would be surprised if a tax credit debt as recent as yours will not be pursued at some point.
Is this tax credits debt large? how large are your other debts? how old are they, since the accounts were opened, not since you defaulted on them? Have you looked at whether you could reclaim an PPI? are you renting or buying?
S says
hi
who would be the best company to discuss my options either DMP or IVA or does it not really matter
Sara (Debt Camel) says
It does matter a LOT if you choose an IVA or a DMP. See the above article for points to think about.
I suggest you talk to National Debtline about your options as they can advise on which would be most suitable for you. See https://www.nationaldebtline.org/ and phone them on 0808 808 4000
S says
Hi Sara
i have around 19K of debt which includes Credit cards, payday loans, and a HMRC Child Tax credit over payment of £9k.
i am discussing with Creditfix for the best solution, and they are suggesting an IVA over Bankruptcy.
is there a for and against for either?
i live in rented accomodation with no assets.
regards
Sara (Debt Camel) says
Can I ask a few questions first?
How much do Creditfix say you are likely to pay a month in an IVA, have they said?
Are you working?
Have you used payday loans a lot?
S says
Hi
Creditfix have reckoned £120 a year for 4 years, then £300 for 12 months when my car finance ends
Yes I am working full time
Sara (Debt Camel) says
Your car, is this on HP so you will own it at the end of 4 years? Or is it on PCP or leasing where you have to hand it back unless you can make a large payment?
S says
The car is on HP so I will own it after 4years
Any advice?
Sara (Debt Camel) says
car finance makes both IVAs and bankruptcy complicated…
You need to look at your HP paperwork and see if there is a clause in the small print that says that the agreement may be terminated in the event of your Insolvency. See https://debtcamel.co.uk/car-finance-iva/ and as that says, if there is this clause, ask on the forums at theivaforum.co.uk whether your lender does repossess cars when someone starts an IVA. This is an area where Creditfix may not have warned you there could be a problem with an IVA.
Is your car essential?
How large are your debts and how much trouble are you in at the moment? Also have you already tried to reclaim any PPI on your debts?
S says
Hi
I could get a company car with my job so that would alleviate that one
My wife needs a car ( which is also on finance) for schooling etc
I will check the contract for this
I have tried the claim for payday loans but quick quid declined and Wong’s have taken 5 months thus far to acknowledge
Sara (Debt Camel) says
So you have two cars? Is your wife’s car finance in your name? When does this one end?
Wonga – send your complaint to the ombudsman immediately and say you have had no response. They should have replied within 8 weeks.
Sara (Debt Camel) says
If you are going to switch to a company car, this needs to be done before either an IVA or bankruptcy. Doing this will mean your take home pay will reduce – you want this lower amount to be the basis for determining your IVA payments – and you will also want the HP debt from handing back the car to be included in your IVA.
Laura says
Hi there, I have about 13k debt no assets. Payplan are advising an iva. I’m self employed but only recently started the business. Obv the debt would be gone quicker with an iva but I don’t know what to do
Sara (Debt Camel) says
I am always dubious about someone starting an IVA with a very early stage business, because your income could be quite erratic. Do you feel comfortable with the IVA monthly payment Payplan is suggesting? I would suggest having a talk to Business Debtline https://www.businessdebtline.org/ and see what they say about either a DMP or bankruptcy as alternatives.
Richard says
Hi
I currently have approx. 60k in debts I have a mortgage with about 50k equity we are really struggling to pay our debts and have tried to remortgage but our debt owed is stopping us. we currently have no arrears on any debts but getting into more debt to keep up repayments. I have consulted an IVA company who say my repayments on our debt would be £300. My wife is concerned about the equity in the house after 4 years do we have to remortgage or sell our home. getting a remortgage would be difficult I would presume any advice would be much appreciated
Sara (Debt Camel) says
“My wife is concerned about the equity in the house after 4 years do we have to remortgage or sell our home. getting a remortgage would be difficult I would presume” good question to ask! In the 5th year you are asked to remortgage. There is a calculator here https://debtcamel.co.uk/iva-equity-release/ that shows how much you may be asked to release – have a play and see what happens if house prices change. You are right that getting a remortgage is very hard, in fact usually impossible, but some IVA firms will say that you have to release the money by taking a secured loan from a bad credit lender – these can be VERY expensive – I have seen people being quoted 19% APR for a 10 year loan.
Are all the debts yours? or half your wife’s?
How stable is your financial situation – may you need to move? have a child? is your job at risk? will you have a child needing support at uni? Is your mortgage repayment? do you have a car on finance?
J says
Hi,
We are in the process of talking to Payplan with regard to our debt, we was thinking along the lines of a DMP but they recommend a IVA, is that because they earn money from one compared to a DMP?
They have also told us that if we can’t release any equity on out property that they would never ask us to take a secured or unsecured loan out.
Has anyone else dealt with this company and had any good or bad issues with them?
So confused by everything and not sure which was to turn with it all.
Thanks
Sara (Debt Camel) says
Payplan will make more money from an IVA, but it may still be the best option for you…
“if we can’t release any equity on out property that they would never ask us to take a secured or unsecured loan out.” That doesn’t really help you – the problem is if you are offered a secured loan at a very high rate of interest…
If you don’t mind answering some questions:
– how much do you owe? your partner? how much of those totals are joint debts?
– do you both own the house? is there a lot of equity in it? is your mortgage a repayment mortgage? when does the fixed rate end?
– what are payplan suggesting as a monthly IVA payment?
– how old are you both? do you expect any changes to your family or jobs over the next 6 or 7 years?
J says
Hi,
We owe around £66,000, mix of individual and joint.
Our house is jointly owned with a repayment mortgage, fixed rate ends in two and a half years.
Yes there would be equity in our house, a rough valuation is around £350,000 and our outstanding mortgage is £115,000 at present.
Payplan are suggesting a monthly payment of £640.66.
I’m 54 and my husband is 57.
There is a possibility that one of my sons will be coming home from university this year at the end of his course but it would only be for a temporary period. We don’t expect any other changes.
I don’t know if it makes any difference but we do have a disabled son who is 28 and lives with us full time.
This is what Payplan have said in there email regarding releasing equity on the house and what happens if that can’t be done.
– As you are a homeowner, if you have any equity, you may need to release some of it to pay towards your debts. If you are accepted for a re-mortgage, this may be at a higher interest rate than you are currently paying. If you cannot re-mortgage, you will need to continue making regular payments into your IVA for a further 12 months.
Thanks
Sara (Debt Camel) says
An IVA probably is a reasonable option for you to consider.
How affordable do you think the £640 a month will be? For such a long period? Have Payplan taken into account any benefits your son gets when calculating this? (I hope not!)
Are both your jobs stable?
£640 a month leaves some room for adjustment if your mortgage cost goes up in 2 and a half years.
The “secured loan” issue isn’t covered by in that paragraph. Can you ask Payplan to confirm you would not be asked to take out a secured loan at a very high rate of interest?
J says
Hi,
I emailed Payplan and asked if we would have to get a secured loan and this is the reply I got.
Thanks for your email. Under no circumstances would we involve any third parties and you would not be expected to take out a secured loan against your home. If this is something that is particularly concerning you, you could request to have it written into your IVA proposal that you would agree to 6 years of payments initially rather than attempt to remortgage.
Thanks
Sara (Debt Camel) says
That may be a sensible solution for you. You are clearly going to be over the 15% equity mark so you will definitely have to pay a 6th year and getting this sorted now prevent it being a worry.
The only downside I can think of is that is removes a bit of flexibility – if say one of you was having health problems by the end of the 5th year. But in that case you could ask for your creditors to agree to end your IVA early.
J says
I think there’s still a lot for us to understand about IVAs before we make a decision. My husband doesn’t really like the sound of going down the route of an IVA and would prefer a DMP, we realise this will then take longer to pay off but we feel we would be able to cope with the monthly repayments if we could get the interest and charges frozen.
Is this something that could be done?
Thanks
Sara (Debt Camel) says
Yes interest is normally frozen in a DMP. And you can complain if it isn’t – see https://debtcamel.co.uk/creditor-wont-freeze-interest/.
But if you are paying £640 a month to a DMP than it will take 8 or 9 years. That is quite a lot longer than 6 years in an IVA. Any health or employment problems could mean the debt isn’t cleared by the time you are retired.
How does the £640 compare to what you are paying at the moment? What are the chances of you increasing your income? getting a lodger? Inheriting any money? What are your pensions like? A DMP for a few years then a tax free lump sum from a pension could be used to make a final settlement offers on some debts?
Alex says
I’ve been in a DMP for 2 years and I’m thinking of changing to an IVA as it will be several years shorter.
But I’m a school governor. Some things I found on the internet say I can others I. can’t continue if I have an IVA and there is a gov.uk page that says you can’t if you have an arrangement with creditors so now I’m worried that I should have told someone about my DMP? Can you help?
Sara (Debt Camel) says
The easy bit first: there are no problems about being a school governor if you are in a DMP. A DMP is an “informal” arrangement with your creditors. What you have seen (I wonder if it is the rules about disqualification from being a charity trustee here https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/731084/010818_Disqualification_Reasons_Table_v2.pdf ?) will have been referring to a formal arrangement with your creditors in an IVA.
From here it gets trickier. There are different sorts of schools – maintained schools where the oversight is from the local authority, academies where the oversight is from the DfE and governors are both company directors and charity trustees, and private schools, which are often charities but I am not sure they have to be. So the rules for different types of schools may be different. And even where the basic rules are the same, I am not sure there is any reason why a particular school couldn’t decide to have a more restrictive policy if it wanted. You can certainly find examples on the web of schools who ask potential governors to complete a form which includes them saying they are not bankrupt or in an IVA.
I suggest you should make some enquiries about the policy of the school you are at. The Clerk to the Governors or the Chair should treat this in confidence.
Cheri says
HI,
I have about £14K worth of debt, I live with my parents so no house to worry about.
All the debt is loans and credit cards.
I’m currently paying about £600 per month.
Creditfix have recommended an IVA over 5 years but I’m not sure what would be best for me.
Is a DMP going to be better long term?
I’m worried about an IVA effecting me purchasing a property in the future once it has finalised.
I can probably afford no more than £300 per month on these debts.
Any advice would be greatly appreciated.
Thank You
Sara (Debt Camel) says
Creditfix will make about £3500 from setting up an IVA for you – not exactly impartial. £250 a month would see your debts repaid in full in less than 5 years in a DMP. And it is much more flexible if your situation changes – undertaking to carry on living with your parents for 5 years is a long while!
I suggest you talk to national debtline on 0808 808 4000 about your current situation and how it may change.
Lauren says
Hi
I have about £24K worth of debt, I live in a private rental, so no house to worry about.
All the debt is loans and credit cards.
I’m currently paying over £600 per month.
National debt advice sent my details to astute finance and they have recommended an IVA over 5 years but I’m not sure what would be best for me. This is based at £306 per month, with £5k of the debt written off for me.
Is a DMP going to be better long term? I am worried as to if going for insolvency (IVA), is it going to effect, work, rental property, phone contract, car insurance.. is it too close to bankruptcy?? As I know most companies only ask if you have CCJs or been declared bankrupt before. Not if you have an IVA?
I’m worried about an IVA effecting me purchasing a property in the future once it has been finalised and paid off after 5 years total and off the credit file after 6 years total..
Any advice would be greatly appreciated.
Thank You!!
Sara (Debt Camel) says
First can I be clear that the “National debt Advice” that you have spoken to is NOTHING to do with the well-respected National Debtline. NDA is a lead generator – they will get c £800-1000 from selling your details to an IVA firm that will then make several thousand pounds in fees by setting up an IVA.
That doesn’t mean an IVA is wrong for you. It just means you haven’t had impartial debt advice!
How confident do you feel that £306 a month is affordable? how stable is your income? Are you likely to have to move in the next 5 years, or get another car on finance?
Miss A says
Hi,
I am desperate for advice. I owe approximately 19k in debt to credit cards, loans, childcare, HMRC.
I spoke to Stepchange charity and they said I can afford 170 PCM to pay my debt off and I can clear that with an IVA. My situation is constantly changing and I’m concerned if going into an IVA is the right thing for me. I am a single parent of two kids, one of which is a baby 4 months and their needs are forever changing. I feel as though stepchange hasn’t considered the constant costs of nappies and cloths with a growing child and future cost of childcare when I finish maternity leave and return to work. Also in a few months my maternity pay would change and as it’s going to decrease I’m scared to commit to anything. I really want to get rid of my debts. DMP isn’t suitable for me either. My brother was like get a insolvency Practitioner yourself and cut out the middle man and apply for an IVA. I’m concerned that going into an IVA will affect my future even when it’s finished or so I’ve been told. I’ve been in default since 2016. I really don’t know how to sort my situation out. I can’t go bankrupt I have HP car which I need for my job. Is there any other way?
Sara (Debt Camel) says
StepChange is not a middleman, they have an in house IP and set up IVAs themselves.
If yiu think your situation is going to get worse in a few months, I strongly suggest you do not apply for an IVA now but wait and review it it after you are back at work and are aware what all your income, benefits and expenses are.
Go for a DMP for the next few months. DMPs are good temporary options while you wait and see how things will go.
IVAs are not flexible solutions. A lot of them fail when someone can’t maintain the payments. Unless you are a very high earner I would be surprised if a single mum of 2 including a small baby can afford £170 a month in an IVA for the next 5 years.
You can sometimes keep an HP car in bankruptcy and you can sometimes lose it in an IVA, see https://debtcamel.co.uk/car-finance-iva/
Imran says
Hi,
I am currently struggling with huge debt approx £47000 and am looking for possible options on how to deal with them. I found this site searching for various pieces of information and it has been very helpful to read the posts and the suggestions. My current situation is as follows:
– Full time employed with salary of £73k; monthly net approx £4k; Live in privately rented home with my wife and 2 kids. I am so far up to date with my payments and have not missed any. My monthly outgoing in terms of loan installments and credit card payments is approx £1500.
– However since major chunk of salary goes in the paying the installments and credit card bills, I am not left with enough to go through the month, hence new credit or balance transfers every now and then.
I have spoken with PayPlan, StepChange, National Debtline and Citizen Advice. They have all told me about DMP (Step Change suggested to go with this option), IVA (PayPlan recommended this option) and Bankruptcy.
I can make payments of £500 – £600 per month towards the lenders. If I go with DMP it takes me about 7 – 8 years to clear the debt. If I go with IVA it takes me about 5 years to clear the debt. I am not sure about bankruptcy.
I am confused on which option should I take. Should I opt for IVA or DMP?
I am renting and am also concerned which option would make it worse for me to find a rented property in the future.
Please advice.
Thank you.
Sara (Debt Camel) says
So you have been given a lot of advice on the three options. It is a genuinely hard decision. I will just add a few points to think about:
1) do you think your situation (income and non-debt expenses) is likely to get better or worse? If you feel it may get better, then a DMP will take less time than expected which may tip the scales in favour of it. If you think it will get worse, a DMP will take longer and choosing an IVA or bankruptcy is probably a better idea.
2) it doesn’t sound as though you have any assets to protect. In that case bankruptcy is usually better than an IVA. It is over sooner – only 3 years of payments not 5. And it is more flexible if your situation gets worse. Bankruptcy can’t fail, an IVA can, in fact at the moment more than a quarter of IVAs are failing.
3) both an IVA and bankruptcy have the same bad effect on your credit record and will make it MUCH harder to get a new tenancy. A DMP is not seen as so serious by many landlords.
4) do you have a car? on finance? you need to take that into consideration.
In general if you can’t decide, one good way forward is to set up a DMP and see how it goes for 6 months. At the end of that you can think again – is your position getting better or worse? Is interest frozen on all your debts? Waiting a few more months and borrowing more to make the payments is NOT a good option if you can’t decide.
Jane says
Hi,
I currently have 66k worth of debt ( mixture of credit cards and unsecured loans). I am mortified that it has got to this point. I jointly own a house with my husband (£112k outstanding on mortgage, worth approx £350k). My current fixed rate mortgage deal ends Jan 23. I earn £51k and my job is stable. Most of the debt is due to over budget house renovation costs. I have always paid my bills and never defaulted, all of my accounts are up to date but the monthly repayments are not sustainable and a lot of the original deals are coming to an end and the interest is creeping up and up.
Payplan have assessed my situation and have advised that I should either have a DMP or IVA. They have worked out that I can afford £532 per month to pay my creditors. This is within my means and I am happy to pay this amount as my job is secure. I am torn between the two options. I do not want to risk my home in any way but equally I need to not want this hanging over me for years and years. I do not have any cars etc on finance.
Can you give any advice please?
Sara (Debt Camel) says
Have you missed payments to any of the debts or is your credit rating currently OK? What about your husband, does he also have debts? What does he earn?
Jane says
No missed payments and credit rating is fair/good. My husband had debts of approx £45k. He earns approx £23k. I would be looking to sort out my debt and not a joint thing.
Sara (Debt Camel) says
your husband has debts of twice as much as his salary? Can he afford the debt repayments? what is his credit rating like?
With a joint property, i think you need to be looking at a joint solution to both your debts.
(If you don’t want to because you are unsure if you will be remaining together you should avoid an IVA like the plague. as if you split up and the IVA fails the house may have to be sold and all the debts repaid in full plus the high IVA fees.)
The problem here is your joint mortgage. With that level of debt you are likely to find it very hard to get a new fix with any other lender in 2 years time.
How large are your current payments to your debts? Have you looked at try to refinace the debt to 0% deals or low interest loans?
Jane says
We are in a fixed deal until 2023 and will probably do another deal with the same mortgage provider as this has been the best option for us over the last 7 years (quite competitive).
My husbands debts are manageable with his income. He has 2 loans (both have about 3 yrs left to run) My wage is the main wage and covers everything else but like I say it does not leave us much flex. We currently pay over £2k a month on repayments (this would reduce down to about £1300 pm (if I were to go on to the DMP). I can’t get another cc or loan without bringing the debt down more.
My gut is telling me to go with a DMP first and review every year. I am daunted by the IVA and the equity release thing at the end.
Sara (Debt Camel) says
An IVA will also destroy your credit record more.
But an IVA would be over in 6 years. And if you went to StepChange, I would feel more comfortable about the equity release clause – I don’t like the way Payplan interpret theirs. If you both have stable jobs then an IVA is not a poor decision.
A DMP will last much longer.
One thing you could do is start a DMP and see how it goes for 6 or 12 months. You could always plan to increase your DMP payments in 3 years when your husband’s loans are cleared – or at that point save up his loan payments to try to make lower settlement offers to your debts. That could speed a DMP up a lot.
So although a DMP looks a lot longer at the moment, it is more flexible and, if you are determined, you could use this to decrease the time a DMP takes.
Jane says
Thank you. I have decided that DMP is the best in my current situation. You mentioned about PayPlan’s interpretations, would you recommend StepChange over PayPlan for the DMP too?
Sara (Debt Camel) says
No, they are the same.
Do review your DMP decision. After 6 months check that all creditors have frozen interest. After 12 months think how easy or hard it is and reconsider an IVA. When your husband’s loans are clear, get a new plan.
And do include all your accounts, including overdrafts, in the DMP.
Lynn says
Hello! I am going to take an iva with Abbots Insolvency company based in Manchester. I have never heard of them before that’s why’ll worries if they are ok to have a financial commitment with for 5 years. Can you recommend them? Thank you
Sara (Debt Camel) says
Can I ask if you are renting or have a mortgage? This changes the sort of things you need to think about.
Sara (Debt Camel) says
So to explain what you need to think about.
The IVA firm you are talking about has this as its “front end” [website now deleted].
You may have thought the fact it has the Money Advice Service at the top means it is approved by them? It isn’t. It is not an FCA authorised debt adviser at all…
Also it is one of the firms that advertises with google keywords so that it comes up when someone tries to find the well-respected debt charity National Debtline. Although not illegal, I think this is disgraceful and I don’t see why a reputable firm would want people to mistake it for a national debt charity.
You may have been given good advice by them – but as you aren’t an expert, there is no easy way to tell. It is quite easy to describe other debt solutions in a way that makes them sound off-putting. And to not point out the problems with IVAs…
Did they tell you that at the beginning of 2020 over 20% of IVAs started in 2013 are still ongoing and over 20% failed? A “5 year IVA” can very easily get extended a lot when people have problems.
Did they tell you that at the beginning of 2020, over 25% of the IVA that started in 2016 have already failed? So the failure rate for IVAs is getting worse?
Did they tell you they would make more than £3000 in fees from your IVA?
So back to my questions.
If you are renting, there may well be a better debt solution for you than an IVA. IVAs are meant for people with large assets to protect. At the moment they are being mis-sold to a lot of people who should have a different debt solution which is why more and more are failing.
If you have a house, then IVA may be a good option for you if you have a stable income. But here you need to go to an IVA firm who you will trust not to make you try to get an expensive secured loan in the last year of your IVA to release equity.
StepChange will not try to force you into taking an expensive secured loan. There are very few complaints about StepChange IVAs.
They can also do DMPs, DROs and can talk to you about bankruptcy. They are not a one trick pony firm that only does IVAs.
So I suggest you talk to StepChange: https://www.stepchange.org/ to see if an IVA is a good idea for you, what your other options are, and for a well-run IVA if you do need one.
David says
Hi,
I’m currently on a DMP with CAP. am I better changing to an IVA? I owe around £26k and have finance on a car of £1100. I have a joint mortgage with my brother and equity in the house is around £24k
Sara (Debt Camel) says
How much are you paying to the DMP?
How secure is your job? Your brother’s job?
What is the chance of either of you wanting/needing to move out in the next 6 years?
finance on a car of £1100 is that how much you have left to pay? how much are you paying a month? at the end, do you own the car?
Rachel says
Hi there,
I have an IVA which I’ve been paying for 5 months now. I’ve realised it’s not the best option for me anymore, due to not being able to do any overtime (I have more time on my hands and would like to pick up overtime which I currently can’t as it would all go to the IVA).
Can I switch from a IVA to a DMP?
Sara (Debt Camel) says
That is normally not a sensible switch.
It’s very easy to change from a DMP to an IVA if things get worse.
But changing from an IVA to a DMP if things get better hardly ever makes sense as the IVA insolvency marker would still be on your credit record for 6 years :(
Sorry, it is a shame you did not look at this sort of thing before signing up to the IVA.
You will get to keep some of the overtime pay in an IVA, but for many people this just isnt worth doing. A lot of extra work for little gain.
Patrick says
Hi,
For years I worked full time and running small business on sole trader basis. I could afford a bit of luxury. Once self employment stopped I needed to rely on my salary currently 38k. I have shared ownership mordgage and my debts are about 50k. Contacted freeman Jones and they advised iva. After reading this forum I’m thinking would it be better for me go DMP as it gives me more flexibility, for instance pay more then agreed when I can. Also have pcp for my car. I understand once it finishes all money goes to iva and I have no car to go to work??? The company assured me they won’t ask for secured loan on 5th year if I can’t remoegage. I don’t really know what to pick
Pat
Sara (Debt Camel) says
What have FJ quoted for a monthly payment? This is the starting point for you to decide how realistic the IVA is. And a DMP is.
How convinced are you that this will be affordable at the moment? If energy bills jump in April?
When the finance finishes, you will normally be allowed to take out another contract costing the same, but you need FJ to confirm this in writing before you agree to an IVA. The problem then is that the only lenders who will lend to you will be the likes of Moneybarn with HP at 49% APR – so you will be paying a lot of money for an old and not great car. When does your finance end?
How much equity do you have at the moment? All yours or do you have a partner?
You need them to put “we won’t ask you to take a secured loan” in writing… or just go straight away at the start for the option of making IVA payments for 6 years, not 5.
Patrick says
I’m single and it’s all in my name. I bought a house, 50% of it, for 112.5 k. The full price was 225k. Current value is about 260k, but its only by Zupla.
Pcp finishes in 3 years, but FJ says they’ll let me have another cpc for car but not more then I pay now. Honestly I took 20k car as was quite well off two years ago, earning about 4.5 k per month after tax.
So you are saying iva could be set for 6 years straight away without being asked to remortgage on 5th year???
FJ suggested about 150gbp/month towards IVA as some expenses such children maitannance can’t be reduced as its court order abroad, not in UK. Also I don’t mind paying for kids, I look at it as my duty, no question asked.
My friend went thru IVA few years ago and he says that was the greatest decision he had ever made.
I’m expecting to have pay rise and be on 41k from March. I could try to get bit better paid job in industry for about 45k but it’s pointless as all will go to IP.
Already canceled unnecessary subscriptions like apple music, gym membership or netflix. I use pay as u go phone, canceled 1 life insurance (had 2) but that’s it. I can only eat less.
I’m on fixed term with BG for another year so I am not worried about bills yet.
FJ doesn’t do DMP but I can stop working with them and approach someone else.
Another concern is I need emergency founds, just in case and on IVA I can’t have them.
Thanks
Pat
Sara (Debt Camel) says
FJ says they’ll let me have another cpc for car but not more then I pay now.
yes – but the problem is with an IVA on your credit record no one is going to give you a PCP deal. You will be looking at a very expensive interest HP deal.
So you are saying iva could be set for 6 years straight away without being asked to remortgage on 5th year???
yes it can. See “option 2” in the equity release section in here https://debtcamel.co.uk/2021-iva-protocol/. If FJ say you won’t qualify for that, then you need them to put in writing to you that they would not ask you to take a secured loan if it is not possible to get a remortgage.
FJ are part of the same group as Gregory Pennington, who do provide DMPs. But they charge a monthly fee for DMPs, so you would be better off going to StepChange who do not charge a fee.
£150 a month would be £10,800 over 6 years. What do you think your monthly after tax pay increase might be in March? You will have to earn a lot more to be able to clear the debts in a DMP within 6 years… that is the plus point of an IVA. In an IVA not all of a pay rise goes to the IVA – but 50% of it can make people feel it isn’t worth bothering to work long hours for.
Have you actually defaulted on your debts?
Patrick says
Just spoke to them and she said to set iva for 6 years straight away I need to be over 60 years of age.
I haven’t missed any payment yet.
Pat
Patrick says
And I’ll have no secure loan requirement in writing.
Sara (Debt Camel) says
I am sorry does this mean they WILL put this in writing?
Patrick says
Sorry my bad English..
It will be put in writing, that I will not be expected to take out secured loan. If remortgage fails.
I should have paperwork ready by Monday and we will see.
Pat
Sara (Debt Camel) says
ha! Over 60 – that is nonsense.
Patrick says
Hi,
Spoke to FJ and made them aware Id done my homework on 2021 protocol. They confirmed that for now per their calculation I’m option 1 client – 5 years no remortgage needed.
Many thanks
Pat
Sara (Debt Camel) says
ok! There is an argument for that as it is can be very hard for people with shared ownership to get a secured loan. Interesting to see that when pushed by someone that has done their homework, they back down.
This makes quite a big difference to your IVA or DMP decision – a 5 year IVA compared to a DMP of very uncertain length. Now I would say your only real issue is your car – and that will be a problem even in a DMP, though that is easier without insolvency on your credit record.
Patrick says
Hi
Sara (Debt Camel) says
January 6, 2022 at 8:04 pm
ha! That is nonsense.
Just spoke to FJ making them aware I know the 2021 protocol. They confirmed that per current calculation I’m option 1 client.
For now it’s looking good. I should get my paperwork ready by Monday and I can confirm is that in writing.
Many thanks
Pat
Derek says
Hi, I have 50k credit card debt,I’m single with renting place. I’m a full time employee earning about £1450.00 per month after tax. After all the expense I only have about £100 left. Should I go for DMP or IVA ? Does IVA increases if I make more money ? (Thinking of getting a better pay job) am I still allow to travel ? ( family doesn’t live in the UK)
Thanks
Sara (Debt Camel) says
The £100 a month left – is that before you pay the credit cards?
That seems like a huge amount of debt – how has it got that large, have lenders just increased your limits while you have only been paying the minimum? I am asking to see if you have any possible reasons to complain about this.
How much more could you earn in a month? Even getting a 20% rise would not make a big enough difference…
Yes your payments go up when you earn more in an IVA. Many people start off thinking they will get 80% of their debts written off and find out that in end they pay massively more than that…
An IVA or DMP would not normally have a large amount allowed for travel.
stuart says
We are on a DMP with stepchange, missed 3 payments over the last 12 months, underestimated our budget. we owed £33,000 in unsecured debts, creditors stopped interest. know owe £25,000,
we are paying £705 a month, our wages equal £1050 a month each,
rent from council. we had 2 cars on HP, had equity in them, we sold them, paid off HP, used the equity to buy 2 old cars, used that equity to pay the £705 a month as we did our budget wrongly. Equity all gone now, cars worth £1000 and £2200 approx
Did new budget but upped everything, more realistic, higher ( also included £80 a month private pension contributions) Calculator said we have £30 a month TOTAL free income and creditors require £5 min, (we owe 12 creditors)
But if remove my pension contribution and reduce expenses slightly, it would take us over the £75 EACH threshold for a DRO, plus one car is worth around £2200, we are 55, safe but very physical jobs. hence fear an IVA, due an inheritance of £3000 this month, NOTE-my parent is very old,ill and we leave me £40,000 when she dies.
need to use some of the £3000 on household worn out goods, + keep rest for bankruptcy costs? ( can we keep our old cars each?) or if IVA, it will take the £3000, so I may withdraw it from bank , But if we do DRO, one car, may not allow this, plus £3000 will stop it also, as £2000 is limit, worried can i spent some or all of it or hold back £90 or £580 for potential bankrupty or DRO each?
.
Sara (Debt Camel) says
How do the debts split – how large are your debts? how large are your partner’s? Who owns which car?
Gemma says
Hi,
My husband and I have a large amount of debt between us (£68000) Currently our minimum payments are £2700 per month.We have contacted business debtline (I am self employed) they have done a budget sheet with us, ans suggested 4 different options. Payment arrangements, a DMP , an IVA or bankruptcy. We then spoke to Payplan to ask their advice, they suggested either a DMP, IVA or bankruptcy, but their recommendation was for us to go into a IVA. Their reasoning is that it would be quicker than a DMP with the security that we won’t be hassled as we have 18 different creditors. They also said that with a DMP that it could take us 7 years to pay it off and that our credit rating could be affected for a further 6 years from that,if defaults were put on at the end ? They said that because i was uneasy about the bankruptcy option that the IVA was less severe.
We are privately renting and have been renting this same house for 11 years.
My husband thinks we should do the IVA over a DMp as he feels like it is better that we don’t have the risk of creditors hassling us etc and that we will have finished paying in 60 months . Whereas the DMP could be an extra 2 years (if all creditors agree to stop interest) We are at the point of signing the paperwork for the IVA and I am just worrying that we are possibly making a mistake, and that we should be considering the DMP. The payments we will be making to the IVA will be £890 a month.Do you have any advice?
Sara (Debt Camel) says
Is your husband also self employed?
Are a lot of the debts joint debts? Or how does the 68k split between you – eg yours 30k, his 20k, joint 18k?
Your house, do you feel confident you will be able to stay there for another 6 years as it is VERY difficult to find a new tenancy when you are in an IVA – it is normal to have get a guarantor.
Do you have a car? On Finance?
Why are you uneasy about bankruptcy? An IVA is not “less severe”, it has the same bad effect on your credit record as bankruptcu and goes on for much longer. A third of IVAs fail because people cannot keep up with the payments – bankruptcy never fails.
It is unusual for people to be hassled in a DMP after the first month or two while things are settling down. Interest is almost always frozen and if any isn’t you can complain and get that stopped. Are most of your creditor’s credit cards, loans that sort of thing? Most creditors will also default the debts near the start of a DMP so that they drop off your credit record after 6 years.
Do you think it is more likely that you will be able to may to the debts in a year or two or less?
Gemma says
Thanks for your reply.
It is just me that is self employed, my husband is in full time employment.
My husband has £30000 in his name on credit cards and a loan
I have £36000 again on credit cards / store cards, and we also have a joint £2000 overdraft.
With regards to the house, I feel fairly confident that we will be ok here for the next 6 years – we have been here 11. We have never been late on any rent payments and our landlady lives locally so we have a good relationship. However 6 years is a long time and nothing is certain with renting so it is living on “hope” that we will be ok for 6 years! We have no car finance.
We had been under the impression when discussing options that bankruptcy was a more severe option and more potential to affect jobs / landlady would be told etc. I think we were led to believe that an IVA would be more “discreet!” Than bankruptcy.
We have the paperwork to sign for the IVA and something is just telling me that maybe we should be going for DMP instead if we don’t want the severity of insolvency? It would seem that we would pay off the debt just over 6 years with a DMP rather than the 5 with an IVA ?
Sara (Debt Camel) says
It’s unusual for your landlady to be told about bankruptcy unless there are rent arrears. See https://www.citizensadvice.org.uk/debt-and-money/debt-solutions/bankruptcy/how-bankruptcy-affects-you/check-how-bankruptcy-affects-your-home/
You husband would know if bankruptcy is a problem for his job – this also is unusual.
There is a single register of insolvency in England and your name would be on it for either an IVA or bankruptcy.
Your overdraft. Can I ask how much of the month you are in the overdraft? This may sound irrelevant but if you have any possible affordability complaints then these would really speed up a debt management plan but make little or no difference to an IVA where the IVA firm would take any refunds. See https://debtcamel.co.uk/tag/refunds/ for articles about affordability complaints.
If you think you can pay off the debt in 6 years with a DMP personally I would prefer that. DMPs are just so much more flexible – you can pay more or less if you have to, make affordability complaints, your debts may well be sold to a debt collector who may accept a lower amount to settle them. And you avoid insolvency on your credit record.
Gemma says
We are in are overdraft constantly and use the whole overdraft every month.
Our income is pretty stable, my husband has been in his job for 19 years and I have been self employed for 14, so I feel that we would be able to commit to a Dmp for the next 6 years, and just feel that if we can pay the £890 a month to an IVA then actually with a DMP it wouldn’t be much longer and less impact on us? Just don’t want to make the wrong decision. We know we have to do something.
Sara (Debt Camel) says
100% right you have to do something.
If you are in the overdraft for all or most of the month, you may well be able to claim back interest – read the article in that link for details about it. It can wait until you have made the DMP decision though – I am only mentioning it now as it shows that a DMP can be speeded up.
I feel that we would be able to commit to a Dmp for the next 6 years, and just feel that if we can pay the £890 a month to an IVA then actually with a DMP it wouldn’t be much longer and less impact on us?
I agree.
You may find this artcile helpful: https://debtcamel.co.uk/worried-dmp/
Gemma says
Thank you so much for your advice. I really appreciate it. It does feel helpful to have another input.
I will speak to Payplan regarding a DMP rather than the proposed IVA. I will also read the article that you have sent. Thanks again
Tam says
I have a total debt of roughly 13k. This is from credit cards and paypal etc. i pay each month into these cards. Roughly hundred quid each. To avoid reaching the credit limit. The interest charges are fairly high. These were accumulated during lockdown when prices went up and people being furloughed. I live with parents and pay no rent. Just bills each month. I have no cars or assets. I pay a loan off each month which i can afford. I am currently speaking to national debt relief after seeing raving reviews and they have given me all their options. I am unsure whether I should go for an IVA OR DMP. My monthly wages are roughly 1700 and is stable. I am looking for a higher paying job and willing to pay more off so the debt is cleared. What would you advise is the best option. I know they all affect credit score but i dont want it to be seen as a bankruptcy route. This is a first for me to look into these routes but would love for my anxiety levels to go down. I can pay off the full debt in instalments and NDR have said their interest freeze rate is pretty solid.
Please help me clear the two options
Sara (Debt Camel) says
An IVA is a form of insolvency like bankruptcy. If you may want to move out of your parents and get a tenancy in the next 6 years you should avoid insolvency unless you have no other choice. But you do not seem to be in a desperate situation at the moment so from what you have said you should rule that out.
NDR may have “rave reviews” but you don’t trust reviews. People leave them when their plan is set up and everything looks great. They rarely think to go back and change them a few years down the line when it isn’t so good…
Instead if you are having problems with the current debt payments I suggest you talk to StepChange https://www.stepchange.org/how-we-help/debt-management-plan.aspx. They do not charge anything for DMPs, so you will be saving money and your debts will be cleared more quickly.
NDR don’t point out on their website that it’s easy to get a DMP with no fees. There are no advantages at all in paying for a DMP, you get exactly the same plan, it just takes longer as fees are being deducted from your payments. See https://debtcamel.co.uk/choosing-a-debt-management-company/ and phone StepChange on 0800 138 1111
Tam says
Hi. Thanks for the response. I totally get the reviews part. Theres a handful who have reviewed after they completed there 5 years. But I tend to overthink so did not do anything. As of yet. Ndr charge a £25 fee as stated on their factsheets. They claim to not charge hidden fees and its the one fee I believe wether its one off or monthly. But of course I would rather pay MY debt off quicker without paying a fee from that too. I will look i to stepchange and see what they are about too. Thanks for the info
Tam says
I have also checked reviews for stepchange and did not find this comforting. Il see what can be done. The reviews I have seen is once a plan has been made or the fact no one answers. I understand there may be high volumes of calls. But I need a company who is easily contactable when I need to :)
Sara (Debt Camel) says
NDRs website says it charges £20-£50 a month DMP fees. So that’s £240-600 a year that could be clearing your debts instead.
StepChange runs hundreds of thousands of DMPs successfully. I suggest you ignore reviews. There is an annual review of your plan but you can ask for an earlier review if a lot of your costs have gone up. Or a payment reduction or break for a few months if you have an urgent expense. They are easily contactable.
James says
Hello I have around 13k debt in loans/credit cards , I worked in UK but moved to Poland to take care of my parents and my income dropped. I have full time job but its not enough to pay debts. Was looking at StepChange and have income 800pound and 80 to spend on debt payment, whats the good option if I live abroad. I might move back to uk next year but not sure
Sara (Debt Camel) says
In an uncertain situation an IVA is never a good option. Waiting until you earn more and/or decide whether you will return to the UK may be a better way forward than setting up any debt solution at the moment. But talk to National Debtline – you can call them from outside the UK or use their very good webchat, see https://nationaldebtline.org/contact-us/
Noel says
I read the links especially on but I’m still torn between continuing the DMP or IVA. I also read that IVA is needed to protect a mortgage and no mention about the same thing which is the reason I’m considering the IVA.
Are there instances wherein a mortgage holder managed to offer F&F after several years in DMP plus without getting CCJ?
I read it was rare to get a CCJ when someone is paying the DMP regularly. How come it was rare? Aside from non-payments of DMP, what would be the other grounds for raising a CCJ?
If a CCJ do happen, do I need Stepchange to mediate or just go to court? Need an advise.
After my debts had been sold, what’s the ideal time to offer for F&F?
In your experience, are most debts being sold don’t contain the CCAs?
Sara (Debt Camel) says
I also read that IVA is needed to protect a mortgage and no mention about the same thing which is the reason I’m considering the IVA.
I have no idea what that statement means. You may have misunderstood some IVA advertising.
Seriously an IVA is a very bad option for you if you think there is a real chance that you may get a significant amount of money back. In an IVA that refund will not help you at all
Are there instances wherein a mortgage holder managed to offer F&F after several years in DMP plus without getting CCJ?”
Yes. CCJs in a DMP are unusual. F&Fs aren’t.
“I read it was rare to get a CCJ when someone is paying the DMP regularly. How come it was rare?”
Because a DMP means you are paying all you can to your debts. Getting a CCJ doesn’t change that. They are more common for business loans or guarantor loans.
I’m not saying a CCJ is impossible for you, I am just saying they are not routine.
It’s isn’t clear to me on what grounds you could defend a CCJ.
At the moment you are no where near getting CCJs. None of your creditors have threatened them have they? No one has sent you a Letter Before Claim/Action?
You cannot plan now for every eventuality in your sort of situation. Or indeed for what your options may be in a few years.
Get your new mortgage fix. See how the scam refund is going.
Noel says
Hi,
Still no creditors had threatened or send Letter Before Claim/Action.
BTW. I migrated in this country last 2016 so in the country where I was born debts normally were being settled via forceful jail time normally no trials or something really bad will happen to me and my family. I witnessed these situations numerous times with friends and relatives, which was one of the several causes that I turned to suicide.
It is a relief that UK had avenues that I are just and humane in dealing with debts. I will keep everyone posted about the new fix mortgage and scam refund.
Carl says
Hi I’ve just set up a DMP with step change that will be settled in just over 3 years because I have just started a new job which is 36k a year I will be paying back just over 700 a month! I own a house with my ex partner who is currently trying to buy me out estimated equity of 45k is my share of the house! When I have paid my debts I would probably look at trying to buy my own place again so insolvency (IVA) does scare me! Was a dump the right option?
Sara (Debt Camel) says
how much were the normal monthly payments on the debts before the DMP?
have you missed any, defaulted on any already?
are you currently living in the house or have you moved out and are renting elsewhere?
An IVA when you expect to be bought out of your share of the house would be an insane idea – all your debts would have to be settled in full, you would have to also pay the large IVA fees and you would have an insolvency marker on your credit record.