www.iva.co.uk

I have an outstanding debt of 41,883 which I am currently in a dmp paying 188 per month to 13 creditors which I have been doing for over 3 years. My free dmp company contacted me telling me that a good option for me would be to have a IVA. After flagging up my uncertainties I went along with it and my proposals were drawn up, I have equity of about 41,000 my proposals stated that I should pay 117 per month for 4 years and then remortgage for 32,000. I cannot afford to do this but have said that I could remortgage up to 12,000 which would mean at present paying off 27%. The company have come back to me to say they have looked at their costs again and that I could have a full and final iva costing 25,000 now.

But again it is unaffordable. I have now been told that in order to do a full and final outside of an iva I need to raise 80% of outstanding debt.

Is this right?

hi caroline g welcome to the forum i cant answer the question but someone will be along soon who can answer this so dont worry to much

High hopes & skint pockets!!

Caroline,

Has your company written to the creditors regarding a FFS? As without doing so you cannot guarantee that the creditors will accept a certain %. I have dealt with many FFS (outide of an IVA) and the %'s that creditors accept are all very different especially given that you have been in DM for 3 years. Who are your creditors? Have any debts been sold on? Do you own the property solely or with a partner?



Jo Rolland
Debt Alternatives
www.debtalternatives.co.uk

It does not appear to me that an IVA for £25,000 would be viable for creditors, if you have equity of £41k, and debts of a similar amount. But, as Jo, says you might be able to make informal offers of settlement to your creditors on such basis, but dealing with 13 different creditors will make it a difficult task to try and get everyone's agreement. To this end the use of a firm who specialises in debt adjustment might be sensbible.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

What you would be best doing is speaking to either your existing mortgage provider or an Independant Broker and find out what you could release by way of equity be remortgaging. Once you know the figure and before proceeding with any remortgage, your creditors should then be written to offering a FFS. I normally start by offering 50%, some creditors may accept this figure as they may have bought the debts from the original creditor and others will require some bartering.

Jo Rolland
Debt Alternatives
www.debtalternatives.co.uk

Hi
Not to sure about the initial advice regarding the IVA at £117 per month,I wonder how much of that would be gobbled up by IP fees ?
You are almost solvent having equity that nearly covers your unsecured debts.
I do feel that a full and final would be a good possibility as you seem to have a low disposible.
As long as you could afford the remortgage it could be a good solution for you.
Speak to several mortgage brokers to get an idea of costs and afforability.Then contact an IP to propose your offer

Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

Hi

There are a number of brokers who post on this site who will be only too pleased to talk you through remortgage costs and options.

FREE ADVICE IS THE BEST ADVICE

LEYBRIDGE LIMITED
Mortgage Broker & Mortgage packager
Specialising in adverse credit.

Firm FSA No:313790
Personal FSA No:MJB01557

see feedback and testimonials at:
http://www.leybridge.com/testimonial.php
Check out my blog at:
http://mikebdomain.blogs.iva.co.uk/
Please read our Initial Disclosure Document(IDD):
http://www.leybridge.com/Leybridge-IDD.pdf

Hi Caroline,

If you are paying £188 per month towards debts of £41883 it would take eighteen and a half years from the start of the DMP to repay the full debt (presuming interest and charges have been frozen).

This isn't good news for you. It also isn't good news for your creditors. Some of them could be paying back a percentage of your monthly £188 contribution (to the DMP company) so they will not make a full recovery even in that long period.

I think therefore that your creditors would be delighted to consider a fair full and final setttlement offer. Perhaps you could ask your DMP company for a list of who they are currently paying for your debts. I'd bet that many of them are companies who have purchased your debts. They may have paid pennies in the pound for the debts and therefore an offer could equal a quick profit for them.

One idea might be to find out from a mortgage broker how much equity you could release from your home without your mortgage going up in cost by more than the £188 per month you pay to the DMP now.

If that raises a decent sum then you could have a really good chance of clearing debts and managing your ongoing finances in a sensible fashion.

You could handle the negotiation of the settlement yourself or pass it over to a company that would handle it on your behalf. If you do that I'd suggest that you choose a company that charges you a percentage of the saving negotiated. That way their motivation is the same as yours and if they fail it will not cost you anything.





Andrew Graveson
Independent Mortgage Broker & Bright Oak Debt Management
andrew@brightoak.co.uk
www.brightoak.co.uk

I know when I was proposing my IVA, creditors were getting so desperate that several called me and said pay 50% and we will call it quits! So I think your "no less than 80%" might be a bit high!