Can windfall be used for final settlement?

[Lottie12]

Can anyone help?? if we received a £5000 windfall payment, is it acceptable to offer to use this money to settle the IVA? Relatives can only offer us £10k. we have 16k left to pay on IVA. 10k+5k is £15k BUT am i right in saying they will disregard our £5k windfall anyway?? really struggling to know what to do??

[herbekj]

The windfall payment would likely to be captured within the IVA and paid across and you would normally then just carry on making your payments and the creditors would get a better returned percentage.

But you could offer to introduce the additional 10K after that. Based on your figures the 5K windfall and 10K offer it would mean you paying back nearly your originally agreed percentage and creditors may be happy to take the money now.

Your IP would be the best person to definitively say whether the offer is worth persuing.

[kallis3]

Hi and welcome.

It could well be that they use the £5k as a windfall and you have to pay it across.

You can but ask if they will accept this and the relatives help as a full and final - they can only say no.

[kallis3]

I hope they accept it Lottie - let us know.

[kazzafunk]

To be honest with you, offering £10,000 against a £16,000 balance is worth trying, so I would be paying the windfall over and making the F&F offer.
Make sure that the IP knows that the money is only available to end the IVA and would be withdrawn if not accepted (some companies like the money up front before the meeting so it is prudent you get that letter to protect your relatives money).

Good luck - give it a go!

[plasticdaft]

If you dont ask you dont get!!!

Paul

[komakino]

Shouldn't you get to keep the first £500 of the windfall?

[Foggy]

Not always komakino -- all depends on the terms of your IVA

[MelanieGiles]

The windfall is automatically captured into the IVA as a matter of course, so cannot really be used as a bargaining point to end an IVA on, unless you have lost or severely reduced your disposable income in which case for commercial reasons it might be possible.

[herbekj]

In this scenario though where you could offer 10K later (after paying across the windfall) meaning you could reach your original dividend with payments made, the 5K windfall and then the 10K, would creditors not be interested in that sort of offer just out of interest?

[morgan105]

In this scenario though where you could offer 10K later (after paying across the windfall) meaning you could reach your original dividend with payments made, the 5K windfall and then the 10K, would creditors not be interested in that sort of offer just out of interest?

I don't think the windfall works like that, I believe it would only work if you were able to reach %100 of your original debt and not the dividend amount. The windfall means the creditors get a higher dividend then originaly expected from the IVA.

[kazzafunk]

I think if the windfall is paid over in it's entirety I would be tempted to put the £10,000 offer in as a full and final offer. Especially if there's any reason why you want the IVA to end early (ill health, redundancy, baby, etc).

[herbekj]

In this scenario though where you could offer 10K later (after paying across the windfall) meaning you could reach your original dividend with payments made, the 5K windfall and then the 10K, would creditors not be interested in that sort of offer just out of interest?

I don't think the windfall works like that, I believe it would only work if you were able to reach %100 of your original debt and not the dividend amount. The windfall means the creditors get a higher dividend then originaly expected from the IVA.

The OPs original question was using a 5K windfall and 10K from relatives as an F&F. No they can't do that.

But firstly they pay over the 5K, no questions about that, it's a windfall.

But now they have 10K from relatives unrelated to the windfall and to reach the original dividend they need 11K more.

Got too be worth persuring surely.

[MelanieGiles]

Why wait until later - the windfall is a windfall, but the third party offer can be made at any time, and perhaps creditors may be more mindful to accept if there is a larger sum to be paid out.