is this a reasonable offer, can you you advise?

[tolond]

Hi we are 2 years 6months into a 6 year IVA with no 4th year equity release.The total was for 90,000 and we have paid approx 20,000 towards it so far.We are using a company who have tabled an offer for 18,000 to finish it early.
Can you you advise on whether this is a reasonable offer and the likelehood of it being accepted.many thanks

[MelanieGiles]

Hi tolond

I assume that you have been approached by one of the mortgage companies who seem to be making a living out of finding proposed settlements for IVA debtors.

I assume that you are making payments of approximatey £650 per month, and therofe I do not see how you can be paying £90,000 in total unless your payments are due to increase. Assuming that you still have £70,000 to find then I cannot see how creditors would find £18,000 attractive, indeed I think you will have some difficulty in persuading your IVA supervisor to present that.

If you mean that your overall debts were £90,000, what is the value of your yet unpaid contributions. If this is a sum nearer to the £18,000 being offered, then this may have some chance as there will be a saving on IP fees.

Please provide more information, and don't forget to keep your IP in the loop.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.
View my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[tolond]

£90.000 is our original debt. Our orignal payments were estimated at paying back about £50,000 so this would pay back £38,000 of that.

Thanks

[MelanieGiles]

Hi again

So you are offering £18,000 against future expected IVA payments of approximately £30,000. If I were your Supervisor, I would look critically at this offer, expecially if you were affording your IVA contributions with little difficulty. Even with the saving of IP costs, you will be offering a reduced dividend than was originally offered for no reason other than wanting the IVA to be completed earlier. I suggest you look at increasing the re-mortgage sum, or continuing with your contributions for a lot longer.

I have noticed a lot of companies like the one you are dealing with springing up, and would advise anyone who is approached to discuss the possibility of early settlement with their IP first before proceeding. And certainly do not hand over any money for their costs or valuation fees until the way ahead is cleared.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.
View my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[tolond]

Thank you for the advice. We have got in touch with our IP and she says it is unlikely they would accept. My only (and hopefully final) question is that Jefferson Hobbs who are making the offer on our behalf are not asking for any up front fees and do feel there is a realistic figure to offer.

I do appreciate what you are saying and that also Jeffereson Hobbs have a vested interest in going ahead as they then get a substantial fee if it all went through. However can not understand why they want to go ahead with this offer if both IP and you feel it would not go through.

Hope this makes sense!

[MelanieGiles]

I personally do not feel that there is a place for these types of company. If you want to settle your IVA early, you should talk to your Supervisor. You do not need an intermediary company to be involved, who are only in it to make money at the expense of your creditors after all.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.
View my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[Skippy]

I was contacted by one of these companies (apparently they are going to send me their newsletter - yippee!) offering to help me settly my IVA by remortgaging. Just one problem - I have nothing to remortgage as I'm not a homeowner!

Four down, fifty six to go until freedom!

[razamataz_]

Hi Skippy,
[:x)]I thought you had to be a home owner for IVA? I assume you are working tho'!
regards razamataz_

I was contacted by one of these companies (apparently they are going to send me their newsletter - yippee!) offering to help me settly my IVA by remortgaging. Just one problem - I have nothing to remortgage as I'm not a homeowner!

Four down, fifty six to go until freedom!

[freelili]

Me too; companies contacted me, I assumed they meant my mothers house which is mortgage paid. This is what I was trying to communicate before Melanie,in another post. I am wondering where they get their details from, as my origional IVA dudbt go through because I pulled out.

LILY

[Skippy]

No Razamataz, you don't have to be a homeowner to enter into an IVA. From what I understand it's more straightforward if you are not a homeowner. Yes, I am working though - I keep suggesting that I become a kept woman but he's having none of it!!!

Onwards and upwards!!!