Hi there, sorry for the essay but hoped you would be able to maybe roughly answer my question and confirm what i am saying is right or totally wrong.
I am in an IVA and have so far I have paid back about 3K over 1st Year of payments around 230(some months overpaid due to overtime)
However I am considering a Lump Sum payoff but am confused now, as I have done the calculation of how much creditors would get in the 5 yrs if I paid 230 for full term and the other way of lump sum payment of 8k after I have paid 3K already. tel me if I am wrong but calculations below.
Paying over Full Term of 5 yrs at 230
Original debt: 17K
IVA: 13K
Fees: 5K
To Creditors minue fees: 8K
Calculation: 8K divided by 17K * 100 = Pence in the £: 47p to creditors
Lump Sum Payment
Original debt: 17K
IVA: 13K
Lump Sum: 8K
Paid 3K
Total Paid: 11K
Fees: 5K
To Creditors minus Fees: 6K
Calculation: 6K divided by 17K * 100 = Pence in the £: 35p to creditors
Someone tell me if I am wrong, but how can a Lump Sum agreement work if you are offering less than IVA and works out paying less back to creditors or am I missing something and being stupid?
You have probably miscalculated the fees. If the IVA is to conclude early, the IP ought not to charge you full fees of £5k, and that is where I think you will find the difference.
Would you have any advice of what sort of fees i would be looking at paying, I mean if say paid them today for instance 8K, there would be only 1 yr of the IVA run before completion, so what sort of fee would i be looking at paying for that, as the fee is going to ultimately set whatever is left for creditors get back in the £ on remaining money i presume.
I would suggest that there would be a proportionate reduction for the remainder of the IVA which has not yet passed - so I could hazard a guess at at least £2k saving - but probably best to check with your own IP to be sure.
Let us know what the outcome is as soon as you hear back from them. May I ask where the funds to effect the full and final settlement will be sourced from?
Well the funds will be coming from my Girlfriends car as in order to help pay off the IVA, she will sell that and should get about 7k for it. Then with other help and saving on her end, can probably tope that up to about 9K if needed.
But if the Settlement figure is anywhere above 9K, then might be too much to arrange.
I mean the idea of settling this IVA after 1st year and not waiting 5, means I want to explore everything before going ahead, as to be clear of this would be a great weight off my shoulders and then the new start begins.
I mean the only advantage of being in this IVA apart from keeping the crediters off my back, is the fact it has forced me to budget and realise how much money I can save and little I have to spend to keep comfortable.
With this F&F Settlement, is there anything else I should be aware of, as dont want to be going into this with my head in the sand and unawhere of anything
I would ask your IP to work out a settlement figure for you based upon returning the original dividend pledged to see what they come up with in terms of the amount.
Glad to see that you have found the IVA educational - this is one of the unseen advantages of this procedure - and what a lucky guy to have such a generous girlfriend. I predict years of washing up/hoovering/ironing by way of payback!
I am going to ask the IP this week, if dont get reply from Email.
It is just very confusing, I take if if i ask for a settlement figure, the IP has no decision in it apart from going to crediters and saying what are you willing to settle for and whatever they say is final, and IP goes with that aslong as there fees are covered.
Also, a thought, if i know I will have 8K to settle with, should I tell my IP this and go to crediters with that or go to crediters without an amount and wait for what they decide on?
As for Hoovering/Ironing/Washing, to raise extra funds, I have sold the Hoover,Iron and sink, so wont be able to do any of that : )
I think that it would be helful to let your IP know that you have £8k available, and ask whether they feel that would provide a sensible offer. I actually think that it would, but best to check with them specifically.
