Full & Final Settlement IVA

[simon.b]

I could be in the position of offering a Full & Final Settlement IVA in that I could possibly offer £14k to creditors to clear my £31k debt up front. This is something I only heard about yesterday and looks like a good solution.

Looks like I got my dispoasable income all wrong and it would actually only be in the 300's! Thanks to those that helped me out and clarified thia for me...

[MelanieGiles]

Hi Simon

If you have disposable income of £600, then your creditors are unlikely to agree to accept a full and final settlement offer of £14,000!

I cannot see the logic in you distributing the £14,000 and then putting the remaining debts into an IVA - if that is what you are suggesting. If I have misunderstood your suggestion could you clarify please.

You will need to enquire of your bank directly whether they will extend banking facilities to you after the acceptance of an IVA.

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

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[Oliver]

There is nothing stopping you from negotiating a full and final settlement with your creditors informally but obviously they would have to agree to this.

If you propose a Full and Final Settlement IVA this will only be an acceptable proposition if you have no (or very little) disposable income remaining. The only way you would be able to do this is if you could show that all your current disposable income would be used to pay back the friend or family member who was putting up the money. However, if you currently have £600 disposable income I would think that you would struggle to get your creditors to accept a full and final IVA of £14,000 as you could pay this money back in c 23 months. This coupled with the fact that c £3-4k of this money would go to your IP would potentially make this a less attractive proposition for your creditors than bankruptcy where they will possibly get payments for 3 years.



Best Regards
Oliver

Thomas Charles and Co Ltd.
Experts in personal debt solutions.
Read customer feedback at: www.thomascharles.com/about_us.asp

[Oliver]

I do not think this offer will be accepted by your creditors. On eof the fundamental aspects of an IVA is that you must always compare what the return to the creditors would be in bankruptcy. In this instance and with your disposable income, potentially the creditors will receive more money in bankruptcy than your full and final IVA offer.

Best Regards
Oliver

Thomas Charles and Co Ltd.
Experts in personal debt solutions.
Read customer feedback at: www.thomascharles.com/about_us.asp

[Skippy]

Hi Simon, I don't think there is a list as such, as everyone's circumstances are individual. I have posted a list of what I was allowed in my IVA and BR on my blog, although please bear in mind that this would vary for you.

Yesterday is history, tomorrow is a mystery, today is the present - a gift to make the most of.

View my blog at http://skippy13.blogs.iva.co.uk/

[Oliver]

There are government guidelines on expenditure but the key thing is to include all "reasonable" costs. Paying £100 a week may be considered a reasonable request but this would also depend on current market rentals (for say a one bedroom flat or house share) in your area etc... If you have spoken to a TC Debt Adviser they will have given you a good idea of what will be allowable in an IVA. These figures will be similar in bankruptcy although on the whole it seems that expenditure is less harshly controlled in bankruptcy than an IVA.

Best Regards
Oliver

Thomas Charles and Co Ltd.
Experts in personal debt solutions.
Read customer feedback at: www.thomascharles.com/about_us.asp