I recently explored a Sprout loan as a means to exit my IVA early.
The offer made was £2550, and the amount that the creditors would receive if I continued with the IVA would be £2967.
Since the offer was made, I've paid 2 more payments of £129, meaning the creditors would get a total of £2808 with the loan, making the total deficit £159...a small price to pay for ending the IVA 2 years early...or so I thought.
I chased up the result of yesterday's variation meeting and it's a resounding no from the Creditors on the basis that the offer is from Sprout Loans.
I'm feeling confused and hurt because I thought I'd finally found a way out of this constant anxiety and depression caused by the suffocating terms of the IVA, and I don't really understand the logic behind the decision either.
I've made clear that I was a different person when I entered the IVA, and in my eyes, the fact that it'd be cleared by borrowing shouldn't be of concern to my creditors.
They'd get almost all of the money that they'd get anyway if I continued with my payments, and they would negate the risk of losing out entirely due to events like possibly losing my job or other risks.
What business of theirs is it if the source of the settlement is from Sprout? They do not know me, and the risk of borrowing is of zero consequence to them. It's two-faced because they'd be quite happy for me to release equity if I owned a home, but they won't accept a small loan.
I would understand if it affected them negatively, but if i'm honest I can't see how the cons of accepting this settlement outweigh the pros.
It feels as if my creditors have taken some strange parental stance where they won't accept it because they know what's best for me.
I believe that there are some creditors (and I know not which) who simply will not accept settlement from borrowed funds as a matter of policy.
Purely thinking out loud, I guess, in this litigious age, there is a possibility that, at some time, a lender like Sprout will be hauled over the coals for unaffordable lending (after all, you are officially insolvent) and these creditors do not wish to be drawn into the melee by accepting settlements funded by such lenders.
On the other hand --- they could simply being, as you put it, 'parental' !
I am not qualified to give advice and can only state my opinions, based on my IVA experiences.