{"id":10657,"date":"2010-12-03T10:09:03","date_gmt":"2010-12-03T10:09:03","guid":{"rendered":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/?p=10657"},"modified":"2019-08-01T10:14:01","modified_gmt":"2019-08-01T09:14:01","slug":"no-disposable-income","status":"publish","type":"post","link":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/no-disposable-income\/","title":{"rendered":"No Disposable Income"},"content":{"rendered":"\n

Believe it or not, in certain circumstances you can enter an Individual Voluntary Arrangement IVA), even if your disposable income is zero. In the current recession many people have lost their jobs and those lucky enough to secure a new job sometimes find that their new salary is substantially reduced from before. <\/p>\n\n\n\n\n\n\n\n

Take a situation where you are in good employment, earning a good salary and enjoying a good but modest lifestyle. No problem paying the mortgage or the car HP. Enough money is left over after normal living expenses of food, drink, clothing, utilities and general living expenses are addressed to service the credit card accounts, a few store-cards, a couple of unsecured loans, and to keep the overdraft below authorized limits. There is enough money left to have one decent holiday a year and to make Christmas and birthdays special for the children. Spouse is also working and everything looks rosy in the garden. Unsecured debts amount to about \u00a345,000 made up of the credit cards, loans and overdrafts but they are not really a concern. You have a couple of thousand ponds in savings and anyway the equity in the house should cover a good part of the unsecured debts.<\/p>\n\n\n\n

\"Unsecured<\/figure>\n\n\n\n

Suddenly employment ceases and after working one month\u2019s notice you \nwalk away with a relatively small redundancy lump sum \u2013 say \u00a320,000. You\n secure a new job relatively quickly albeit at a much reduced salary. \nUnfortunately your spouse is also forced to accept reduced working \nhours. You draw up a new household income and expenditure statement, and\n while you can tighten belts a little bit you see that you can just \nabout maintain the modest standard of living you enjoyed heretofore. You\n can still manage the mortgage and the car HP and cover all normal \nliving expenses. However you have little or no disposable income to \nservice your debt. You cannot even make the minimum payments on an \nongoing basis. Servicing the credit card accounts, the store-cards, the \nunsecured loans and the overdrafts will whittle away your redundancy \nlump sum very quickly. When you check the mortgage you find that there \nis little or no equity in the family home due to the general fall in \nproperty values in the recession. In any case you suspect that you would\n struggle to re-mortgage the property due to the fall in your income. \nEven if you succeeded in re-mortgaging, the loan to value ratio would be\n limited to less than 80%, certainly not even enough to clear your \ncurrent mortgage.<\/p>\n\n\n\n

The annual holiday seems like a lifetime away and you no longer look \nforward to Christmas. Getting any new credit is out of the question \u2013 it\n would only make a bad situation worse.    <\/p>\n\n\n\n

However, all is not lost. You still have your redundancy lump sum and\n your savings. If you were to offer your creditors a lump sum in an IVA \nperhaps they would accept it. The case for their acceptance of a well \nconstructed IVA proposal is powerful. No extravagant lifestyle. No \nequity in the property. No prospect of a return for creditors in the \nevent of your being made bankrupt. It would make absolute sense for \ncreditors to accept a lump sum settlement from you in an IVA. And while \nyour family lifestyle would diminish a little, you and your family would\n be debt free and would not lose your house. So how do you go about \nentering an IVA<\/p>\n\n\n\n

If you find yourself in circumstances such as in the example outlined\n above, a good initial course of action is to consult with a reputable \nInsolvency Practitioner, otherwise known as an IP. Your circumstances \nwill be treated confidentially and your IP will be able to advise you \nnot just on the merits of an IVA but also on all of the other options \navailable. Initial advice should cost you nothing.<\/p>\n","protected":false},"excerpt":{"rendered":"

Believe it or not, in certain circumstances you can enter an Individual Voluntary Arrangement IVA), even if your disposable income is zero.<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"none","_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","footnotes":""},"categories":[6],"tags":[],"class_list":["post-10657","post","type-post","status-publish","format-standard","hentry","category-general-debt-articles"],"_links":{"self":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/10657","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/comments?post=10657"}],"version-history":[{"count":1,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/10657\/revisions"}],"predecessor-version":[{"id":10667,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/10657\/revisions\/10667"}],"wp:attachment":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/media?parent=10657"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/categories?post=10657"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/tags?post=10657"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}