IVA or DMP when I can repay eventually but need help now

[LoisGriffinskitchen]

Exactly as asked. I’m in the unenviable position of needing to consider this or a DMP.

With a DMP I can repay everything in 8 years (if interest is frozen) or 10 years if not.

With an IVA everything is wiped after 5-6 yrs but creditors would get less back.

Im not certain about an IVA as I can repay everything but it’ll now take longer. Also dealing with an IP scares me as I am not sure how hard it will make life. How has anyone else found this?

I have spoken with StepChange who suggest either DMP or IVA,

All due to an unexpected life change. Currently not in arrears with anything but will be very soon unless I start a plan.

So stressed.

I'd go down the DMP route (I did it myself 5 years ago) however, head over to the MSE Debt free wannabe forum first, the threads there are so unbelievably helpful!

If you're comparing those options you probably need advice.

MSE is one option, National Debtline or Stepchange are two others.

IMHO IVAs are in the frame to be another miss-selling scandal as too many providers are in it solely for the profit and not what's best. I think Paul Lewis of BBC Moneybox says so too.

Thank you, yes a talking to SteoChange and I’ve registered on the forum now. The forum advisor told me to cancel all direct debits now and expect t phone calls. It’s apparently easier if they all default at the same time. Taking deep breaths as never had to do this before.

Have you already reviewed your bills and other spending to see if you can make your budget work? No chance of moving debts to 0% deals and keeping up with repayments?

I take it if you're considering an IVA, you are a homeowner? Otherwise they're rarely appropriate.

There's probably little difference between an IVA and a DMP in reality, either way you'll need to send in evidence of your income and expenditure at least once a year, ie a budget, pay slips and bank statements, so they can check that you're not overspending in other areas, paying what you can towards your debts and increasing payments if your income increases or you receive a lump sum, eg an inheritance.

So if you're debts are significant, an IVA could be better for you because it gives you legal protection from your creditors, they can't charge you interest or make you pay more than you can afford and if they start hassling you, you just refer them to your insolvency practitioner, who will be an 'in house' part of StepChange. With a DMP, it's a more informal agreement, without these legal protections.