Full settlement due to unaffordability?

[wakeywakey]

I managed to survive somehow for 5 years and even survived the "equity release" review.
12 months to go but now my interest only mortgage as gone through the roof and worse to come obviously. I simply can't afford the IVA anymore (or the mortgage repayments)

Would it be worth asking the company for a full and final settlement being as I have only ever missed 2 payments due to covid?

But if I did ask, could they then reject my claim and then fail the IVA ?

Wish I had started a year earlier now.

[Breezy]

You can ask for a review of your I&E. If this shows the IVA to be unaffordable you can ask for it to be closed based on payments made to date ( basically calling it quits). If they do not agree to this course, creditors can ask that the IVA be failed, as your argument is that you can no longer make the payments. I cannot see them gaining anything from doing this --- but the risk is there.

I actually did this when I suddenly became a single parent half way through my IVA --- and creditors agreed. But, of course, every case is unique.

The Insolvency Service have issued new, temporary, guidelines relating to Protocol Compliant IVA's, where they have made an agreement that IP's can consider a reduction in monthly contributions of up to 50% of the current payment. or £75, whichever is higher. There are, of course, "Ifs, buts and maybes".  The announcement and full details can be read here: https://content.govdelivery.com/attachm ... 202022.pdf

Our friends at Debt Camel have also written an article which explains the changes, here: https://debtcamel.co.uk/help-ivas-cost-of-living/ Which is a far easier read ---- maybe something there might help.

[wakeywakey]

So what do you think the chances of them agreeing to this would be. I wouldn't want to do it if it's less than say 50%?

[Breezy]

So what do you think the chances of them agreeing to this would be. I wouldn't want to do it if it's less than say 50%?

I wouldn't like to call it. It depends on the current financial mood, who your creditors are and their usual reaction to such things ( a chat with your IP might help here) and the conduct, to date, of your IVA. And the arguments you and your IP present to them. In my early years I had collected 'brownie points' by overpaying ( extra income), so they were fairly happy with me. And I was literally on the "Pay the IVA or feed the kids" borderline, so had to take the gamble. Basically my IP told creditors that I cannot pay any more so they will get no more. If they failed the IVA, they would still get nothing.

[bowline]

Does it matter what the odds are, if you will struggle to pay the mortgage, then you have to stop paying the IVA. What other option do you have?

I would hope that your IVA firm and creditors will be sympathetic in these difficult times. Especially as you are so far through the IVA.