Help for a friend please.

[another1]

Hello everyone, I was doing a bit of research for a friend who is in a bit of a pickle, when I found this website. I would appreciate it if someone could give me some help. I am sorry that this is so long.

Briefly he started an IVA nearly 3 years ago. I have seen his IVA and his payments are £300 per month for 60 months. He said there were no changes to it. If I am reading the IVA right his creditors are around £35,000 and he will pay back 25p after charges. He made the first 22 payments ok but was then involved in an accident. His employer would only pay him sick pay whilst he was off work. He rang his IP who said that in the short term he could miss his payments until he returned to work but any arrears would have to be repaid either by making extra monthly payments or an extension. The IP also said he might need to speak with the creditors if he is off work for a long time. Unfortunately the injury (his own fault, he fell of a ladder at home) has not healed and he still cannot work. He has now lost his job and his only income is £61.35 per week Incapacity Benefit. I am not sure if he can even live on this! His Doctor thinks it will be several months before he should even try to go back to work. He has now missed 10 payments.

He spoke to his IP today who said that as he is unlikely to return back to work in the near future the IVA would fail. The IP mentioned having another meeting but said he could not do this as he does not know when my friend will be going back to work. He asked if creditors would take what he has already paid in settlement but the IP said no because he has not paid enough. He has paid £6,600 but I guess the IP has charges to come out of this? The IP said he would ask creditors if they wanted him to make my friend bankrupt as he does not have enough money to do it but that this was rare and he would probably issue a failed notice and then my friend would be back to square 1. My friend says he understands what his IP has told him (he talked to him for over 20 minutes today apparently and has always got the help he needed in the past). I think he would be better off bankrupt anyway as he has a modest lifestyle and lives in a shared rented house but he is upset that his creditors won’t get any money from him.

Does he have any other options?

Thank you for your help. Again sorry it is so long!

[MelanieGiles]

Hi there and welcome to the forum - and thank you for presenting such a well written set of notes! Long certainly - but definately easy to read and understand at this late hour!

I have to agree with the advice that your friend has been given by his IP. The IP has nothing certain upon which to offer a variation to creditors, and I feel that the added pressure of a failing IVA is just putting more stress onto your friend.

As he has no assets, and no disposable income, bankruptcy is clearly the best way forward and as he is on benefits at the moment the cost will be reduced to £335.

[another1]

Thank you for your quick reply. I was just looking for bankruptcy costs. My friend has no money and is stubborn about paying his debts but if I can show him that it is not just me that thinks he should go bankrupt then I will give him the money I think to get it over with.

[Soulgrowth]

Hi ... just wanted to say welcome to the Forum ... what a nice friend you must be to have [:)]

There are a few of the Forum members here who have experienced bankruptcy, I know Skippy for one is just coming to the end of hers. I am sure Skippy has a "blog" ... as do some of the other members. I was thinking that perhaps you could show your friend some of the blogs and hopefully prove to him that bankruptcy might not be so bad as he thinks, as Melanie says would relieve some of the stress for him and would give him a bit of a fresh, new start.

All the best

Debbie

[MelanieGiles]

It will cost your friend £335 whilst he is off work on benefits.