www.iva.co.uk

Hello all,
I have a quesiton about a one off settlement amount. I have a large property debt to a private investor. He is about to repossess the properties and once sold will have an unsecured debt outstanding of about £150k. I also have credit card debts etc of about £50k. If I agree with him a one off settlement of 5p in the pound(on the £150k) and he agrees(I will go bankrupt otherwise) can I add my other creditors in at that rate and will they have to agree as well on the basis that he is 75% of my unsecured debt?
Thanks in advance to anyone that can assist.
Neil

You will need to take advice from a couple of insolvency firms. There is a list and customer reviews at www.iva.com . They will help you work out your best offer. It would be unusual to propose an iva at 5p/£ but there are some posters on here with extremely low dividends so it's not impossible. BR might be the better option if this is really your best return.

If you propose a formal IVA all creditors are bound if 75% of the amount of money agrees to the proposal. An informal settlement would not be binding on your other creditors so you should take advice from an insolvency firm.

I had a situation like this recently where creditors accepted 2p in the £, due to the claim of a bank which represented around 80% of the debt. This bound in a all of the smaller creditors, most of whom accepted the proposals on the basis that they were getting some return rather than nothing under bankruptcy proceedings.