Credit crunch affecting FFS dividends ?

[Trind]

Was just wondering if given the credit crunch and parlous state of the economy, if there had been any relaxation by creditors of returns they were willing to accept on FFS ? My original dividend was 51p in the pound. Will be 3 years in November since started IVA and have been offered some help by a family member to make an FFS offer. Amount outstanding on original £21,000 repayment figure will be £8700 on 4/10/08. Given that my IP fees are £1500pa, and I should save £3000 approx by concluding early, reducing repayments to £5700 (plus any variation meeting fee)do you think an offer of £4500 would be acceptable ? Will write to my IP to seek his advice, but would value any feedback.

[Viki.W]

Hey Trind, I can't answer your question but I'll bump it back up for the experts to advise you. Good luck, X

[kallis3]

Hi Trind,

I can't help either, but I'll bump you back up.

[MelanieGiles]

Those fees are very high, and your IP will no doubt want to charge for the current year and a variation fee, so there may be little saving in costs now. The best thing to do would be to ask your IP to provide you with a settlement figure of how much you would need to now pay in to return 51p in the £. My view is your suggestiong is a little low - but your IP is the one who can really confirm or deny this for you.

[Trind]

Just checked my paperwork again and my supervisors fees are £900 pa (inclusive of VAT), ie £4500 over 5 years and my nominees fees £3500. So £8,000 out of the agreed £21,000 IVA is going on fees. If a FFS offer co-incided with the annual review/report to creditors, which I will be charged for anyway, would a variation fee be incurred ?? Will ask for a settlement figure. My original return to creditors was 47p but I notice in the last report this has increased to 52p. As the creditors all originally accepted 47p in the £ should this be the figure I offer in any FFS ?

[MelanieGiles]

It will depend upon the terms of the IVA and your IPs attitude to whether they feel a variation fee is justified. Your IP ought to be able to provide you with a settlement figure based upon the new 52p in the £.