offering a f&f payment

[G-W]

My IVA is two years old now. I contacted my IP recently about offering a f&f payment to bring my iva to an early conclusion. They put me in touch with a mortgage consultant who contacted the IP to get a settlement figure which they knew the creditors would accept. A re-mortgage is now in the process of going ahead enabling me to offer a f&f settlement. My main concern is could/would the creditors want this as a lump payment and insist I carry on paying the iva? Thereby leaving me at square one.

[MelanieGiles]

Hi garry and welcome to the forum

That will depend upon whether you have any disposable income left after taking account of the increased mortgage payments, and also whether your IVA provided for an equity release during the fourth or final year.

Can you confirm how much you are currently paying into your IVA, the amount that your mortgage payments are going to increase by, and whether you have agreed to a later equity release, and then I can advise you further.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[G-W]

Hi. Thanks for the reply. I am currently paying £450 a month. My mortgage payment is due to go up by around £160 a month. I had no year 4 equity release clause in my iva. The only clause which involved my property was that the house was valued at the time of the arrangement and 50% of the equity at that time (£4000) would be released some time in the iva. The mortgage consultant comes recommended by my IP and he has spoke to the IP who quoted him the settlement figure. So the IP must be sure it will get accepted, surely not? My iva proposed 35p in the pound would be paid at the end. This offer would increase it to 38p. Also, my 21 year old son pays me lodgings which is included in my I&E but he is keen on moving out soon. Should I mention this to my IP?

[G-W]

By the way. garry.w and G-W are the same person. Sorry about the confusion. Bit stressed at the moment.

[G-W]

Melanie, did you mean my new re-mortgage payments? Initially, the consultant has got me a special rate for two years with the new lenders which will keep my payments virtually what i'm paying now with my current mortgage lender. after that it will go up quite a bit. but then, i'll be in a position to remortgage again. Basically, if my IP cant assure me that the iva wont end with this offer, I am staying put.

[MelanieGiles]

Hi again

As your house was not specifically included in the IVA, and you are addressing the £4,000 and offering a higher dividend, I can see no reason why creditors would turn down your offer. You are paying them more money, at an earlier stage, so I would go for it.

The fact that your son may be moving out shortly certainly adds more weight to your reasons for settling early, so do tell your IP about this.

Good luch with your variation. The facts are very similar to those of our own Andy Davie, and his variation sailed through in March this year.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk