I am currently 2 yrs into my iva. I am looking into the possibility of paying a lump sum to get out. My total debt was for £47000 but my total repayment is only £14000 after 5yrs. Do you think creditors may be willing to take £5000 lump sum? I need to know if its a realistic figure before i go and ask family for the money. Thanks
Hi dazza. To be honest with you, creditors would expect as close as possible to the origianl agreed sum, unless there was a good reason for ending the IVA. Why do you want it to end? Your credit rating would still be affected for 6 years from the IVA acceptance date? If there is a good reason ie, health, job loss, children or other change in circumstance then any offer can be suggested for them to consider.
Hi thanks for the quick reply. I am not too botheted about the credit rateing to be honest learnt my lesson on that one lol. The mrs has just been offered a promotion that will require alot more hours and alot more money. If we stay in the iva all the extra income will have to goto iva and she will lose out on watching the kid grow up. Not worth takeing if we stay in but if we can get out then we can use the extra money to pay back a family loan with no restrictions on earnings we can do it quickly. I have other reasons such as possible redundency in a yrs time negative equity in property etc etc. When u say close to orriginal amount do u meen 47 or 13. Five is really the max we could prob find. Thanks
Sorry - I meant the sum agreed for repayment under the IVA (13). I hope you don't take this the wrong way but trying to end the IVA because your income is going to increase is not really fair on the creditors. WIt's the same as if you received an inheritance of £20,000 - you would be expected to pay that over in it's entirety. I understand what you say about the childre, however in my IVA agreement only 50% of pay increases will be paid in to the fund. So if you have this in yours you would still get to keep 50% thus inproving your income to spend on the children or save for a holiday etc. I would be inclined to sit it out and pay the additional - if you are made redundant in a years time then that would be the time to try and negotiate an early finish in my opinion.
But then that's just me and how I feel - just one of many people who post replies. Others may agree with you. Anyway - congrats to your mrs on the promotion!!
Thanks for your honest reply im sure others aswell as myself are gratfull. I havent got such a clause. As my spare income goes up so does my payments. It would not be wise for us for her to take the job sad to say. I know its morally wrong but if we can get out then i think its better. I will phone ip tomor and find out if its realistic. Paid off 2000 so far plus 5000 lump sum. 7000 Garenteed hopefully will be enough. Is there anyone out there that has actually asked about lump sums and how did u get on. Thanks
Thanks for your honest reply im sure others aswell as myself are gratfull. I havent got such a clause. As my spare income goes up so does my payments. It would not be wise for us for her to take the job sad to say. I know its morally wrong but if we can get out then i think its better. I will phone ip tomor and find out if its realistic. Paid off 2000 so far plus 5000 lump sum. 7000 Garenteed hopefully will be enough. Is there anyone out there that has actually asked about lump sums and how did u get on. Thanks
The fact that your income is going to increase is not a good reason for wanting to offer a lower settlement to your creditors. Those lenders accepted to write off an element of your debt in good faith, on the basis that you wanted to repay them as much as possible. Run it by your IP by all means, but don't be too disappointed if they decline to present it for you.
I understand they have done it in good faith but when you weigh up looseing time with kid for no more money then i know which i would choose. Moral arguement aside does a 5000 settlement seem realistic if i explain risk of redundancy etc
Personally I agreed with Mel .... Until your redundancy is confirmed I very much doubt you will be able to go with a F & f offer.when you entered the IVA you knew that you still owed 100% of your debt and although an agreement has been reached to pay over a smaller amount in the life of the IVA all extra income and windfalls should be offered against your IVA making a higher return to your creditors..
Sharing from experiences of dealing with debt
There is a solution for everyone .... Just need to stay positive !
I have to agree with the others here, but to answer your question, you have paid £2k and are offering a further £5k in F&F settlement against an agreed dividend of £13k over the life of the IVA, is that a realistic offer? to be frank? no, I don't think your IP would even present it to be honest, you would need to be looking nearer to the £12k mark I think, so double what you are proposing
Don't wish to muddy the waters or be drawn on the whole moral debate! However, in answer to your query about amounts to be offered etc, I offered just less than half the balance outstanding and it was accepted.
Obviously every case/IVA company is going to be different.
That is true Nat12 but I have noticed an increasing number of people on this forum looking to settle early for various reasons and some with dubious ones too where the original debt was maybe over £40-£50,000 and they have an agreed dividend or minimum amount to pay back of around £15000 and looking to settle for a fraction of that!.
I've gotta say - if the creditors are going to accept some of these offers then we would all be looking for an early settlement!. I think the Full and final offer is being misunderstood. It's there if has been a sudden and lasting change in circumstances i.e illness, redundancy being the obvious ones.
Creditors as I understand look for as near to that agreed repayment at the outset of the IVA i.e your monthly payments multiplied by the term.
Hi
Creditors will take a commercial view and if it is presented well by the IP then it stands a good chance. No problem in ending early by offering a lump sum from family but I think you need to try to offer the original dividend as your circumstances do not mean that your income will drop, 10k would probably do this by the time you factor in saved IP costs
Good luck
I would imagine a lot will depend upon the proposed "write off" should the IVA go to term. If there would be, say, a 10 - 20% write off, there is room for manouvre. If you are looking at those famously quoted 75% write offs, I doubt the creditors would entertain a further reduction in dividend.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
