Full & final settlement offer whilst in breach?

[Happyone]

Hi,

I am in an IVA (5 years - £6,000) and have £4,700 left outstanding (paying £100 a month) to pay, having paid £1,300 off already. I have also had some mental health problems as well as work issues over the last few months and I am currently in breach of my IVA. My Dad is going to gift me £3,000 to offer as full & final settlement for my IVA but would this be enough or do you think it should be £3,500? My parents are both concerned for my mental health regarding my finances and they want me to be worry-free in this regard so are kindly offering to help me now. As I am breach of my IVA, will this make it more difficult for a full & final offer to be accepted by my IP and/or creditors? I am hoping to start a new job so am worried that they may take more off me up to the point any offer is accepted which is stressing me out as I also owe the DWP money for Universal Credit loans when I was out of work last year.

[Foggy]

You will need to address the breach first before the creditors will look at reduced offers to close the IVA early. In view of mental health concerns, speak to your IP and see if they can put a case forward.

[Happyone]

Thank you. I will do that.

[Lisa Thomas]

Good luck.

[Happyone]

Thank you.

My parents have agreed to gift me £3,500 & have written a letter and sent ID & copy of joint bank statement over to my IP company. So hopefully this will be considered & put forward to my creditors.

How long might it roughly take for a decision to come through and wonder if I still need to make payments until then? My parents did note in their letter that any payments made by me before offer is accepted would be taken off the offer amount. Hopefully this is ok.

My mental health has really suffered & this could possibly relieve some of that.

[Foggy]

It usually takes around 2 or 3 months from start to finish and is dependant on which firm you are with (some are habitually slower than others).

You should continue to make payments, unless agreed otherwise, as three missed payments, without prior agreement could see the IVA failed.

Best of luck with the offer.

[Happyone]

Ok thank you.

My IP has come back this morning and said they've passed it to their Variations dept who will 'check if they are ok to propose the offer with it being lower than that due to be received by the end of the IVA'. Apparently they will contact me in the week. This is making me feel concerned that they may not even put this offer forward to my creditors

[Foggy]

It is YOUR offer to make, not theirs. It is not their place to refuse to pass it to creditors for consideration, although they will make a recommendation to accept or refuse, so it is better to keep them on side.

[Happyone]

The advisor at Hanover kept saying that 'the amount that would need to be offered would be the full amount of £4700' but my parents cannot afford to offer that much and are doing it to save my mental health. I have been so so down and depressed about this that it cannot go on any longer. I really hope the Variations department don't make this even harder to reach my creditors

[Foggy]

We have countless examples of F&F offers being accepted at below the remaining payments amount. I suspect that Hanover are simply trying to increase their own income as supervisors fees are often a percentage of the monies paid in.

[Happyone]

Thanks so much for your replies. Is it likely that they may ask me for a review of my IVA payments before the offer is made and/or after if it's accepted? Even though I am still paying into it. Apologies I'm just not au-fait with all this.

[Happyone]

A virtual creditor meeting has been arranged for 17th March so that’s good, only a month to wait for a decision I think? If accepted, will they want the money sent straight away or is there more in the process? I claimed and received PPI years ago so that won’t apply now, although I thought you could no longer claim for that anyway now? It is in my proposal letter.

[Foggy]

Assuming creditors accept the offer, you make the payment as soon as you can after the meeting. Then the IVA will close down as if you had made all the agreed payments.

[Happyone]

Thank you Foggy.

They have put a note at the end saying "The attention of creditors is particularly drawn to the effect of Rule 15.34 regarding requisite majorities, a copy of which is attached to this Notice" but there was nothing attached. Is this anything to be concerned about?

[Foggy]

It is just the rule stating the voting policy regarding the proportions of votes needed to pass the variation and the voting powers of the various types of creditor --- as the notice says, it is for the attention of creditors. Nothing to worry about for you.