We found ourselves with too many debts and not enough money to cover the monthly payments.   Even the credit card minimum payments were difficult.  Finding out that your payments are taken up in interest added, though you pay off about £5 per month from your actual debt on each card, the rest is taken in interest – no matter how big the bill – and we had between us, quite a number of them.

On doing a bit of online research and talking to several charitable companies etc. we started on a debt management method, hoping that would sort out our problems.   The only problem with debt management is you get phone calls all the time asking for a review of your incomings and outgoings.  

If you only have one credit card this is not so bad, but when you have 10 to 20 between you, this is that many times phone calls every six months or so; and when your income doesn’t change, you just feel harassed.   I was in tears after every phone call, it felt like it was never ending and I was going to go to my grave in debt.  It was soul destroying.  

The tension between us was great, it almost split us up.  I don’t even know how we managed to get that many cards; surely it was as much the banks fault as ours.  It was irresponsible of us for borrowing and irresponsible of them for lending.  But we were stuck with the debt and had to do something other than debt management.  We thought bankruptcy would be better than the emotional turmoil that we were going through.  At least it would be over.

Anyway, we contacted a company we found online.  One of their debt consultants, Keith White talked us through our options and mentioned an IVA, we didn’t really understand much about it at the time but he was very patient and explained it so that we did.

Keith asked lots of questions taking all our details and I mean all.  We sent him the proof of our income and expenditure to go forward with the IVA.   The process, whilst very nerve wracking, was a lot easier than we thought as Keith did most of the work, once we had sent him our proofs. He finally told us we were accepted by an IVA company and they would get in touch.  They asked more questions and agreed to take it to court with our creditors, where it was accepted.

The IVA lasts for 5 years, with a possible 6th year if you cannot re-mortgage to release some equity to pay the creditors.  One of the hardest things for us at the time was having to open new bank accounts that had no overdraft facilities (basic bank accounts) and having to live within a tight budget.  We also have 2 mortgages, one repayment and one interest only, which comes to its end this year, when we have to find a little over £52,000 to pay it off.  Obviously, we can’t do this and as we are on an IVA nobody wants to know us for re mortgaging.   Once again the anxiety builds up.  What do we do now, sell our home or go bankrupt after all?  We are 36 months into our IVA now.

I contacted our IVA practitioner with our worries and they got a company who deals with people on an IVA for mortgage purpose to contact us.   We are currently awaiting a decision but have been told that in theory we have been accepted for a mortgage, but they can only lend a certain amount.  Our IVA practitioner is asking our creditors to accept a figure as full and final settlement and if they agree, this figure will be added to our outstanding mortgage for the full figure to be put to the mortgage company.  It is nerve wracking again, but not as bad as it was in the beginning and there is very definitely light at the end of our tunnel.   It was important that at the outset, when we informed about our mortgages, we let them know that one of them was interest only with a set time on it.   This was very important; it would have been easy to simply say our mortgage costs were so much a month, without explaining the time set and then finding ourselves in a predicament.

Who knows, by the end of this year we may be debt free apart from a mortgage that we can afford and have a little income left over to afford the odd luxury.   One thing is certain though; we will no longer borrow money for things we cannot afford.  If we want something now, we will save up and pay for it straight away.   DEFINITELY NO CREDIT CARDS!! There is no way we wish to go through all this again.