Hi. Want to help partner by making a Full And Final offer. Can anyone advise please ?

[Rosie.83]

Hi my partner has an IVA and is looking at making a full and final settlement offer next week he has had the iva for 2.5 yrs and I am looking at borrowing money to help him. He had a total debt of £40000 approx which they have accepted to receive £30000 approx to include the amount of £18000 in equity at yr 4. There is no way the property will accrue this much equity. It has lost £6k in valuation since taking out the IVA already and from sales of flats in area another £8k on top of that!

£28k of the £40k is from a northern rock loan that he took out with prev partner to buy his house but is insecured. We want to sell the flat as it does not suit our needs so looked into full and final settlement else they stated they would put an extra year onto the IVA which would make it a 7 yr IVA.

My partner has paid in around £9k and £2.5k has been paid to creditors. It states on the reviews there is approx £4k "in the bank" can any one clarify what that means?

I was looking at offering £25k as he has already paid £2.5k to creditors and there has been 6 months since last review. Which would help make up close to the £30k, can anyone advise if this is a good figure?

Should I count what is "in the bank" and lower my figure?

Also the £28k from northern rock is in his and his partners name, will his partner still be chased for the outstanding debt? (she is at the moment) although the creditors have agreed to accept 75% of the debt to settle?

So many questions but it is a tricky area and I really dont want to get it wrong. Plus I dont want his ex-partner to be dragged into it any more as she is already paying for the £28k outstanding on the property that she isnt living in because they have been hounding her. Just want it settled now

[Adam Davies]

Hi and welcome

25k seems a very good offer

His ex partner will still be liable for the total debt less the amount received from the IVA

Regards

[Rosie.83]

Thank Davie

Will this b the case even though they have put the whole joint £28k into my partners iva. I assumed the creditors agreed to taking 75p per pound and the rest of the debt was written off. Surely that would mean the "written off" amount is actually written off not then chased up to be collected from the joint holder?

Also can you tell me what "in the bank" means?

If we were to pay 100p to the £ would they then leave she ex partner alone?

[luluj]

Welcome to the forum. As Andy has said the ex partner will be liable for the full amount of debt less what has been paid whilst the IVA is in situ.

The suggested offer is a good one and I would hope creditors see this and agree it. Good luck.

[Rosie.83]

Thank luluj

What i was asking is if the full and final settlement was accepted would this not then settle the debt? ie no longer chase the joint party?

[Foggy]

Hi Rosie. No the debt would not be settled, it would merely fall onto the shoulders of the solvent party.

[Rosie.83]

Thank you Foggy

So just so I can get this clear.....outstanding debt £40k (£28k joint, £12k single), Iva accepted £30k over 6yrs, we settle IVA with £30k. The £10k oustanding will fall to the solvent party?

If the IP can make it that the majority of the money pays off the £28k joint section then the solvent party will have less to be liable for?

[lem]

It may be substantially more than 10k, remember that a proportion of your f and f will go to paying fees so it depends what the final dividend turns out to be as to how much of that loan would be left, so for instance if the dividend ends up at 50p in the £, then of the original 30k loan, 15k will be paid off, the other 15k will fall to your partners ex to repay

[lem]

Plus the ip cannot favour one creditor over another, they have to divide the funds available equally between all creditors

[Rosie.83]

thanks lemm

Thats really starting to make sense now. Can anyone tell me what the "in the bank" amount is for on the yearly reviews?

There's approx £4k in there could this go towards fees so more % to the pound is paid?

[Foggy]

"In the bank" is, I imagine, the monies you have paid in that have not been distributed yet. They could be waiting for a creditor to claim, or just be what has been paid in to the IVA since the last distribution of the dividend, waiting for the next payout to creditors.

[Rosie.83]

Thanks Foggy

If this is the case then hopefully we will be able to use that money to get a higher pence to the pound paid off as we will be offering £25k, partner has already paid £2.5k there was £4k in the bank in Jan and has had a further 6 months payments. Hopefully the IP fees wont be too extortionate so the solvent party wont be left with as much debt to pay.

Thank you everyone for your help. When my partner has the meeting next week I will get him to discuss with them how much he will be paying pence to the pound so i can let the solvent party know what she can be expected to pay, hopefully it wont be too much

[clivemrthn]

Hi
I have been reading with interest posts about f&f offers.

I can understand how an IVA can be settled with a 'windfall'payment as this is 'free' money but I dont understand how settling a debt with loaned money (from whatever source) makes sense.

Surely this is perpetuating a debt situation.

[Michael Peoples]

A windfall would not settle the IVA unless the debts would be paid in full as these funds would be taken in addition to the monthly payments. Obtaining a loan from family as a full and final means you could pay back a lower amount over a longer term with no interest applied and dcould make things easier.

[Rosie.83]

Hi guys

you have all been so helpful but my partner when to his ex wife to explain that he was going to make an offer for full and final settlement, which would be about 75% of the debt (ish) however this means that there is 25% of the debt left to pay and she was not happy about it. she states that he will still be liable to pay for the last amount as his name is on it too? But surely the creditors cannot chase him once he has satidfied the IVA?