We are looking to settle our IVA this year. We have been in it for 2 years and it was scheduled for six. Owing to my wife's ill health, I am having to take early retirement in November and will be able to make a 'full and final' payment offer from a pension commutation. At this time, based on our current monthly payment we will owe £47,000. I have been told that I must write to the IVA company with my proposal in writing together with proof of my pension. Our IVA supervisor has stated that he cannot offer advice as to how much I should offer as the 'full and final' payment. He said that if I agree to pay the full outstanding balance, it does not need to go to creditors. It will just be accepted. If I offer a lesser amount, it will go to a vote. I am tempted to offer a little less because by paying the full amount, we will have actually paid £6000 more than we actually owed to creditors. After fees, the creditors dividend is 92p/£, not taking into account any fees adjustment owing to the shortening of the six year period originally scheduled. Please feel free to advise if you can. How much should I offer? or should I just pay it all?
Hi, I'm not sure of amounts but do know that the nearer to the original dividend the better from reading the forum and other posts. I'm sure more concise advice will be along very soon and I wish you all the best with your Full & final x
IVA final payment left the bank on the 26th January 2013...looking forward to a debt free future.
I am not sure that I agree with your IP that a variation is not necessary. Even if you pay the debts in full, you are varying the terms of the contract - which needs both contracting parties to agree to.
Personally, I would make an offer based on what you would need to pay in to achieve the original dividend, and instruct your IP to put this forward on your behalf.
Have you also explored asking your IP to see if creditors will settle for what they have received to date in full and final settlement? This may not be viable, but I would try and protect that pension pot to the best of my ability if I were you. You may need to survive on those funds long into retirement, when state pensions are likely to be a pittance.
Thanks Melanie. I was concerned that if the creditors were not approached, they would see the pension as a windfall. He assured me that this will not be the case. Our original debt was £78,000. In October this year we will have paid in £35,557.00 'monthly scheduled payments' and an additional £2,319.00 'extra' payments. The balance (based on the original schedule of 72 x £1147 will be £47,027.00 (doesn't include the extra payments). Hence my offer of £45000
I would not be touching my pension pot Bald Runner. As you say, you are having to give up work to look after your poorly wife, and I am at a loss to understand why your IP would be suggesting this to you.
A revised option to end the IVA based on what you have paid in to date should still give a return of around 35p in the £ and keep your precious pension fund away from creditors - which the law of this land sought to achieve as a result of the Welfare and Reform Act in 1999.
Are you obliged to take this pension draw down, and was this suggested by you or your IP? I would be interested to know what firm are currently representing you, and what advice they have actually provided - as of course I do not have detailed knowledge of your case and it can be dangerous to make assumptions.
The IVA company have not suggested that I do this. I made the decision myself based on the genuine fact that I do have to retire for the reason specified. Accordingly, I need/want the IVA to end rather than it drag on. My pension options are lump sum + half pay, or no lump sum and 2/3 pay. Most people take the lump sum of course. We will be no different as we will need a new car and other items.
I wrote to the IVA company today requesting that they propose a Full and Final payment of £38000, the balance at that time will be £47000 giving a dividend of about 93p/£ if I had paid the full amount.
Here's hoping (but not holding my breath!)
Personally, I think they will snatch your hand off at that.
Good luck.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
