Next year, in 2010, I will owe 5000 pounds

[placid]

Dear Sir or Madam,

Next year, in 2010, I will owe 5000 pounds by the time my annual review is due. If I took on a weekend job (now that I have sent my annual review to my IP) to save that 5000 pounds until the 2010 review could I then pay it off or would the IP expect to keep
50 % of my extra earnings (produced by the weekend job)as addition to my regular payment or would they take the 5 grand and clear me?

The reason being is that I am 40 and with two kids and no property, pension or savings and I am desperate to clear my debts and start saving towards buying a property.

Any suggestions as well as a definite answer will be very appreciated.

Best regards
Placido Borges

[kallis3]

Hi,

If you work extra now, then you will be expected to pay some of this money across towards your IVA. You would not be allowed to save it all.

What they take will all depend on your income and expenditure. Although a proportion of your debt is written off, if you can pay back more to your creditors, they will expect this.

[placid]

But if I offer to clear the whole amount before the review is due how will they know that I worked extra? it isn't devious because I would be working solely to pay them off? do they not encourage people to pay up in lump sums...is this not productive for them?

[Skippy]

Jan's advice is right as usual.

When you are in an IVA you actually still owe the full balance of your debts until the IVA is concluded. Just because there is only £5k owing before you meet your dividend it doesn't mean that's all you owe.

I wouldn't recommend hiding anything from your IP (such as a second job) as this could cause a lot of problems when it finally comes to light, which it will. When you offer a full and final settlement your IP would need to know where the money is coming from.

If you do want to go down this route, I would suggest that you are up front with your IP and pay some of the money into your IVA and save the rest to possibly offer a F & F.

[kallis3]

I totally agree with what Skippy has said.

You will always have to tell the IP how the full and final is funded as the creditors will wish to know this.

I don't advocate hiding anything from them as these things have a way of coming back to haunt you when you least expect it.

[placid]

so they want to know where that cash for the pay off is coming from? sure, what if my missus got a job or someone from friends or family gave us the cash? I thought that settling before iva's term has run was very common...how to go about this then?

thanks to all contributors for helping in such dreadful circummstances

[Skippy]

It is possible to offer a full and final settlement, but you would need to provide evidence to you IP of where the money was coming from.

[placid]

thank you, this has made things very clear for me. Just a final question though: do IPs and insurance companies like early settlements or do they prefer the monthly payment over the whole term? are they always on the lookout to see if they can get more?

[Skippy]

I think it depends on your circumstances. You need a good reason for a full and final to be accepted, like a change in your circumstances.

[kallis3]

If your wife got a job, then she would be expected to pay into the household finances, so your IVA payments would probably rise.

A cash offer from friends or other family would be fine.

[placid]

thanks to all of you for your advice and comments

[luluj]

In my opinion why rock the boat with only 12 months left to go !

Your credit rating is shot for 6years from the date of the IVA commencement so what incentive is there - it won't quicken the credit re-build any quicker !

enjoy you children why they are still young, another year on and things may be totally different on the housing market as well etc