I have just under two years of my IVA left to run which, at £100 per month, leaves £2,300 outstanding.
I'm sick and tired of being in a financial state for almost as long as I can remember and need to get myself back on an even keel somehow and one aspect would be to settle the IVA early if at all possible.
My idea is to borrow £1,800 from work and offer that as a Full & Final Settlement. Whilst I would look to pay this back at the same rate as I have been doing I at least would reduce the term left to 18 months and will begin the process of getting my credit rating back into life. Not that I'm looking to get myself back into any debt of course but, looking ahead, it might at least enable me to get a small loan when the car I've had for a few years (and has now done 170k miles) finally 'dies' on me.
As I understand it I would have to show the monies being 'borrowed' as a gift, and could probably get my employers to state it as a bonus or similar, but they would like me to ask the question before commiting to anything. My query is do you feel this would be accepted and just how much would I need to ensure it's presented as mentioned above in order to not 'rock the boat' so to speak?
Thanks in advance.
If your employer describes this as a bonus it will be payable into the IVA in any event, so would not be able to be used as a F&F. You would need to confirm with your IP, but I am pretty sure that an advance would be acceptable for the purposes of an offer, on the grounds that, if the offer is refused the advance would not be made and no monies would be available to the IVA.
As for the amount -- you would be looking at somewhere in the region of £2000.
Also, although your credit rating can start to recover, you would still not be considered "credit worthy" until 6 years have passed from the start of your IVA and your credit files clear, although you might be able to get a credit builder credit card with a small credit limit, which can be there for emergencies.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Thanks for the reply Foggy. If you feel £2,000 wiould probably be the 'required' figure it hardly seems worth me attempting this, especially coupled with the "credit worthy" period not starting till after the 6 years anyway. Seems a 'no win' situation to me....like so much with an IVA
The problem is that -- as the time left to run gets shorter the creditors are saving less on admin costs so a discount is less inviting to them and they might as well just sit it out and get a little more --- added to which the F&F would take around three months to set up, eating into the time saved element even more.
We often feel burdened by the constraints of an IVA and the intrusion into our lives -- but the benefits are certainly there and, once you have finished and are debt free, are worth the journey in the end.
Imagine -- in a couple of years you will be debt free, owe no-one a penny, and be £100 a month better foo It will soon pass.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
There is no harm in borrowing money to fund a full and final payment if this is disclosed. You can then use your surplus to repay the loan.
I think £1800 is a reasonable shot depending on how long it takes your IP to put the variation out. You have nothing to lose if rejected as the IVA just runs its course so in my opinion it is worth a try.
Hi Michael, many thanks for your input.
Have to say I was starting to scrap the idea based upon what I'd been told thus far, but it does seem a little more 'hopeful' from what you say.
I'd only mentioned about stating it would be a gift, as opposed to a loan, as I'd read elsewhere that this is what the IP would want to hear, and to also state it would only be given to me if they agreed to the early settlement at that amount.
You mention that, depending upon how long it takes them to put the variation out, the £1,800 may well be accepted. This is fine except that it seems to me I'd not be saving a great deal if that's the case what with continuing to make my monthly payments in the meantime of course.
Guess I'm looking for something to happen that, ultimately, might not actually benefit me a great deal!
Thanks Lisa, that's very helpful. On the basis that two or three months of further payments could potentially be taken whilst I'm waiting, it was making it seem a rather pointless exercise. What you've stated however makes it possibly more viable...if accepted of course!
It will soon pass.
