www.iva.co.uk

I've asked this one before........but I can't find the thread and I need some views [expertise if available].

When looking at loans outstanding, what is 'usually' or 'often' used in terms of working out a percentage offer on unsecured loans?

Easy with a credit card, as it would be the balance outstanding, but loans are a bit more difficult.

Is it the current loan balance outstanding, or the redemption figure quoted, or even monthly payment x months left to run?

Thanks,

rickyg

Hi
It's normally the oustanding loan balance and it will never be the settlement figure.
There seems to be no difinitive answer on this but I would say that at the best it's the outstanding loan balance and the worst the payments left times the monthly payment.
In my IVA I returned a lease car and the amount claimed was the outstanding payments less a meagre 5%,bearing in mind that they had the car back and sold it two years earlier than they would have done had the lease run it's full course.I actually worked out that they probably lost no money although they put in a claim for 10k.
Regards

this can make a fair difference........

I have a loan that has a current outstanding balance of about £10,800 but if you were to take the number of months left times the amount per month it would be £2,000 more as a debt balance.

This can affect the percentage offer to creditors by a few percentage points. What would you say is the most common method?

rickyg

I had to include the full amount including interest in my IVA figures.

Normally I would take the Loan payment and mulitply it by the remaining term of the loan to give the the balance.

I would then contact the creditor directly and confirm the balance with them, if they gave me a differnt balance then i would use the higher of the two to be on the safe side - as a creditor would normally claim the amount plus any unapplied interest.

You would never use a settlment figure in the calculation.

Normally I would ask the creditor to confirm the outstanding balance to me in writing, to avoid guesswork.

confirming the balance is easy since it's with Egg and I can see the outstanding balance online

this is always going to be rather less than multiplying the amount per month by the months outstanding, isn't it

my point is that using the outstanding balance, rather than the amount x no. payments left, can mean that the percentage repayable across all creditors will be higher [since the sum of all credit will be less], which might be the difference between acceptance and rejection by the creditors

thanks

rickyg

Hi
You make a good point,it's important that you give your IP all the info that they need.I would think that the loan balance rather than the monthly payment times monhs left is the accurate one.Can you imagine how much the NRs together unsecured debts would be if the monthly payment times months left was used ??
Creditors should confirm the amount owed at the creditors meting and this will make the voting percentage accurate.
Regards
Regards