After my car died I was left with no choice but to get out a short term bank loan for £3000.00. Once I had been accepted I naively thought about how easy it had been to get credit. I was around 22 years old and had never been great with managing my money.
I had an online credit account for Very and had been occasionally getting payday loans to cover extra costs that came up. This was where I started and within a year it had completely spiralled out of control. My monthly payday payments totalled more than I was earning so I kept having to get more out to survive. I had tried consolidation at the very beginning which hadn’t worked. I hadn’t yet learnt my lesson.
By December 2015 I was defaulting on several loans, severely depressed and drowning in my own mistakes. I had nearly 20 different payday/short term loans out simultaneously. I finally took the step of coming clean with my mother who I had hidden it all from in shame. She supported me and encouraged me to get financial advice. In January 2016 after an internet search I came across a debt help Company. They gave me the advice that I needed as I knew nothing of IVA’s and Bankruptcy. After exchanging information on the debt I had racked up I was referred to another company to finalise and manage the IVA who have been beyond helpful. From what I remember of the process I was required to give a list of all my expenditure, income and debts as well as proof of these things. From there they put together a payment plan for me. I was then subsequently required to have a telephone consultation with a member of staff who went over and finalised everything. The final step was a meeting between the IVA consultant and creditors to agree on payment. When everyone was in agreement the contracts were signed and I was bound to the agreement for five years after which any remaining debt would be wiped clean. I have just been through my first yearly review which remained unchanged however the terms of the agreement are not to take out any form of debt in the 5 year period and any change of income or expenditure must be told to the company.
Last year I decided that I wanted to change my life around and go to university. The only foreseeable problem was I would need a student loan to do so. While not all IVA companies would allow it I was lucky that I had been given permission to get one.
All in all getting an IVA has been a life saver. It can still be a struggle sometimes to budget and make my income last a month however I am in a much better situation then I was 18 months ago. The only problem I have come across since getting this IVA was a few months ago, when I had unintentionally defaulted on my IPad bill. I received the dreaded letter from a debt collection agency (I had heard nothing from the phone company itself!). I owed a little over £675.00. I contacted the company and offered £50 a month until it was paid off, which they accepted. It was not until a couple of weeks later it occurred to me how stupid I had been. Instead of contacting My IVA Company first, I tried to deal with it direct. I had breached the terms of my IVA agreement without even realising it.
After sending a letter to the company I was informed that I had indeed breached my contract and could be liable for further action. I apologised profusely and explained that as my IPad contract had been taken out before my IVA had started, it had not occurred to me that I was taking out further credit with this other debt collection agency, which was stupidity on my part. Luckily for me, My IVA Company took mercy and agreed to take no further action as long as it was paid off within 12 months.
I am not proud of the decisions I made, and often wonder how much easier my life would have been if I had never gotten that first loan out. I would like to believe that I have now learnt from these lessons and am well on track on getting my life back. I am truly grateful for the opportunity to have an IVA and words cannot express the stress relief it has given.