www.iva.co.uk

Hello all.

I entered into a new IVA in January of this year. My parents have come into some money on retirement and have offered to help me settle the IVA early, on condition I pay them back out of my disposable income. This does appeal to me, as at the moment I have precious little incentive to work hard enough for a promotion.

I contacted my IVA company (but not the IP himself) and they came back to me with a settlement figure they think would be accepted of £12,950. My total amount payable into the IVA was just under £20k over 5 years, including a lump sum £7.5k at the start, and £206pm for 60 months, which I will have paid 6m of in about a weeks time. Therefore I have currently paid about £8.5k, the original total amount I was to pay was £20k - I would have thought that the difference between the two (circa £11.5k) would have been a fair settlement?

I should mention that my debt was £58k originally and the dividend calculated in the original proposal was circa 24p from memory.

Is there any reason why they are suggesting circa £1.5k more? When I queried the amount they said "if you want to offer £11k we will pass it along to the creditors - the figure we have quoted is what we believe they would accept"

Am I risking refusal if I do just offer £11k? I know I am trying to settle very early in proceedings, but I would much prefer to owe my family for my own peace of mind should something happen to my job in these uncertain times.

Bear in mind that although you are given a figure to aim towards with an IVA, you owe the full amount until you have completed and the rest is written off.

Even though you will be paying slightly more than you thought, it is still less than you originally owed.

You can try and offer the lesser amount, but if your company suggests the slightly higher amount, they must think it has a good chance of being accepted.

It is possible that the sum mentioned is what is required to achieve the original dividend. Creditors may accept a lower figure if that is what is offered but the IP has quoted a figure they would be confident would be accepted. Offer the lower amount and if rejected you could ask your folks for a bit more at the time of the meeting.

Thanks Kallis, I am aware of that, and I do not want to appear ungrateful as the IVA has helped me out of an incredibly bad situation, not just financially but also mentally.

Its just I know my parents could afford £11k or thereabouts, the figure suggested by my IP company is becoming a bit of a stretch, but still do-able.

I agree that it would still be a great help to me to finish it early, even at the higher settlement figure.

Good luck with whatever you offer Hungry. I hope it is accepted.[:)]

Thanks Kallis and Michael

I think I am going to give it some more thought before I do anything further. I have two more questions for you now though!


How long does the whole process of early settlement take?

And will the process be held up by the fact that one of my creditors (unbelievably) still hasn't put in a formal claim?

The variation can be drawn up relatively quickly and creditors have to receive up to 4 weeks notice in some cases. So a timescale of about 5-6 weeks would be reasonable.

As for not claiming the creditor almost certainly will when there is money to be apid out.

Hi
I would offer the 11k, there must be savings on IP fees so can't understand the company stating that 13k would be required.
Your creditors are expecting 14k in total, the rest will be IP fees
Regards

Thanks Michael & Andy
I'll let you know how I get on

Good Luck Hungry! Hope all goes well with your offer xx

11k is perfect and offer that - good luck from me too.

Thanks David and VickiLou

Just one more thing - when I write the offer letter for the F&F settlement, are there precise terms or phrases I should use?

I used a template that I found on this site - I just changed a few bits and pieces according to my circumstances. Make sure you state that the money is only available for full and final settlement. They'll probably ask for a letter from whoever you are getting the money from too to confirm they are gifting it to you for this purpose.

Ta Vicky - How long did process take for you? From initial offer to variation meeting to certifcate to the registrar being updated?

I made the offer earlier this month and the variation is now being drawn up by my IP - they said it would take approx 6 weeks for the variation to be sent to me for signing. After they receive my signed documents, they can then propose a date for the creditors meeting, which they have to give 28 days notice for. So I'm still waiting! I kind of feel like my life is on hold at the moment!