Could an IVA be a better solution for me?

[Houser_L17]

I currently have £51000 of debts from 3 creditors. I have a DMP set up with StepChange and pay £190 a month. I've been doing this so far for nearly 2 years. I own my own property which is valued at £178k but have £130k left on the mortgage.

Does anybody have any advice on what I could do here. I can carry on paying £190 a month no problem but I've been thinking of a full and final settlement option. If I can remortgage does anybody think this is a good idea or should I just carry on paying the £190 a month.

I've also been considering selling my property to move in with my partner. Subject to the property being valued at the price about what is a reasonable F&F settle suggestion.

Any advice please.

[Foggy]

I am surprised a DMP was chosen in the first place --- if all creditors continue and all freeze interest you are looking at 23 years until you finish ! I suspect that StepChange would shortly be suggesting an IVA anyway.

On the few facts you have presented an IVA would be a better solution (but, of course, we are not privvy to the full picture). You might have a creditor that, at the time, Stepchange knew would be resistant to an IVA. Either a standard 5 year agreement, or, as you suggest, a F&F IVA ---which, in a nutshell is an IVA consisting of one lump sum payment giving the usual protections.

As to amounts required, that, I am afraid, is a guessing game. If you were to enter into a standard IVA with the same payment the creditors would be getting around £11,400 plus another £2280 in lieu of the equity (assuming you get the extension to term rather than being able to release equity). So in the region of £13.5k. Of course, they might not agree to the arrangement, or you might be able to release equity, so they get a little more. Out of that figure will come around £2.5k in fees. They will also be spending the next 5 years collecting small dividends and spending time and money doing so. So they would see about £11k.

Say you offered £20,000 in a lump sum: They would see around £15k of that but in a lump with much less faffing around. So, on the face of it , a better proposition.

Of course you need to be able to go in with a strong offer. I would suggest a chat with Ryan and / or Shaun, who are whole of market brokers with experience of dealing with adverse credit, and who might have access to products to assistm in such situations. They can be contacted through the info on their profiles here:

Ryan: memberlist.php?mode=viewprofile&u=18488
Shaun: memberlist.php?mode=viewprofile&u=22837

If you sell the property the creditors would expect the lion's share of the proceeds.

[Lisa Thomas]

I agree with Foggy as regards why a DMP was ever suggested initially, unless it was meant to be a short term stepping stone whilst you got another plan in place.

An IVA might work, or perhaps a full and final settlement via a remortgage.