On DMP with bulk figure. F&F IVA help

[kallis3]

You would be protected if you did a full and final, that is legally binding on the creditors and the remainder of the debts would be written off, plus you can let an IP take the strain and sort it all out for you.

I don't know what the time scale would be until a creditors meeting, but your credit record will be shot for 6 years from the time the IVA is accepted.

This will be the same if you come to an arrangement with your creditors, as your credit record is already bad from your DMP.

[MelanieGiles]

It is pretty easy to get agreement with creditors to a full and final settlement outside the IVA procedure. You just effectively make another contract.

[David Mond]

As I have said the only way in english law for a F&F to be legally binding is through an IVA. Not withstanding a written agreement outside an IVA agreeing to accept a lesser sum - this in law is not enforeceable.

[kallis3]

Sometimes your creditors write to you asking for full payment and are willing to accept a lower figure if you settle in full.

Would this be legally binding?

[David Mond]

Under the strict interpretation of english law - no - but funny things happen with creditors. I would think the big banks would honour such agreement but others might not.

[kallis3]

Thank you David.

[Andrew Graveson]

I am no lawyer but in practical terms, as David states, major banks and credit card companies are hardly going to take someone to Court to collect a remaining balance after they have accepted a reduced amount in full and final settlement and have confirmed this in writing.

[David Mond]

In the end I prefer a F&F by way of an IVA - full and unequivacable protection once accepted and paid.

[kallis3]

I think I would feel happier as well doing it through a full and final.

Although they probably wouldn't come back for anymore, I think I'd always have that nagging doubt in the back of my mind.

[Andrew Graveson]

Fair point David.

To balance it are the risks of very high future costs for mortgage holders with a formal insolvency on their credit record.