www.iva.co.uk

Hi

As discussed in this thread

http://www.iva.co.uk/forum/topic.asp?TOPIC_ID=5832

we are just about 90k in debt

We have started the process of applying for a IVA but the possible opportunity of a relative putting a lump sum forward has arisen

The total value of making us bankrupt would be worth about 22k to the creditors, so what sort of value do you think they would be looking for in a one off write off the debt payment

Whilst having to beg to relatives for money isn't nice at all, I'm not sure we can go through the stres of a full term IVA especially as my income is variable (self employed)

We're due to become parents for the first time next month and we just want to put all this behind us and embrace sensible credit free living

It doesn't really work like that, couple 31.There is no minimum that you can be sure of creditors accepting. Your IP will need to make a peruasive argument that your F&F offer is at least equivalent to a 5 year IVA, taking in to account the money on the table now and comparing it with your abilty to pay in over a longer period.

The argument has to be persuasive but there is no doubt that money on the table now, from a third party, provides a strong argument.

How do you calculate the £22k in bankruptcy and what does that figure actually represent? I'm not absolutely sure what you mean by that?

Hi

Sorry, I meant 22p in the pound not 22k

That's what our IP estimated our creditors would get after costs if we went bankrupt and all our assets including equity were sold

Our IP worked out that we could repay 40p in the pound based on diposable income and a 4th year equity release

That however, is cutting things very very tight with no contingency planning

I'm hopeful that we could raise enough cash to make a 45p in the pound one off settlement if they would accept that

If I understand you correctly the creditors would get 22p/£ back in a bankruptcy and 40/£ in a 5 year IVA with equity release.

Logic suggests, therefore, that a F&F IVA offer should fall somewhere between the two,the nearer to 40p you can get, the more likely it will be that the creditors will accept

22p is quite a high dividend in bankruptcy! I am suprised that the differential is so low, and suspect that you have quite a bit of equity in your property? If so, and you can afford contributions, in today's climate creditors are likely to want penny and bun, and therefore your settlement will need to be based on the higher figure in my opinion.

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

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

Hi Melanie

Our house is worth around 200-210k and the mortage secured on it is £162k so there's around 40k of equity in it

When we made the original IVA application, it was based on me earning 1.5k a month as a self employed web designer. I think in hindsight, it just wouldn't work as my income can be very erratic due to people dragging their heels over payment or content for their sites.

As a result of this, we asked our families for help which we had been very relunctant to do as we strongly wanted to fight our own way out of the mess

Between them they can raise a max of 45k, so hopefully this will be enough for a one off lump sum payment after costs? It would match what we originally estimated paying in based on monthly payments and equity release

MAny thanks to everyone who has helped, this forum has been fantastic.

So long as your are able to demonstrate limited or no disposable income to offer on an ongoing basis, that offer ought to be very acceptable to creditors. Make sure that your IP puts the very best proposal forward, making it clear that this is the only way for them to receive a substantial repayment.

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

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp