I am sorry to post this, a multi layered problem which is causing me anxiety when I really should be grieving for my mum who passed away at the weekend.
When all the legal processes and my mum's house is sold and split with my brother and sister I will inherit a large sum of money. Far in excess of the total of the original debt.
Am I right in thinking that the I will have to pay back the entire original debt, plus fees that Creditfix will add, less any payments that i have made?
The original debt was about £38k, joint debt with my wife. We are nearly 2 years into the agreement, have paid about £9k. No idea what the fees are.
The perhaps more complicated bit is we recently had a car accident which wrote off our car. There is a cheque in the post for what the car is worth. We have to replace this car for work/family reasons. This is the 2nd time in 2 years we have been in this situation. Creditfix agreed that we could use the money and a little extra given to us by relatives to buy a new car before. My brother knowing that we are due to inherit a lot of money is offering to lend us money to buy a much better car (which is very appealing). He doesn't know about our financial situation. I was going to tell the family anyway because as joint will executors knew this would come up.
Is it going to be OK for us to buy a more expensive car?
What should I be telling Creditfix?
Can I ask my brother to buy the car for us perhaps? If he 'owns' the car that's got nothing to do with Creditfix right?
Sorry for my rambling, as you can see I dont really know what I'm talking about. Hope it makes sense to someone. Thanks.
Your supposition regarding the inheritance is correct --- you will need to pay in an amount from the inheritance to cover the original debt, plus fees and possible statutory interest. ( Statutory interest is sometimes excluded -- you would need to check.
Fee structure will be dealt with in your opening paperwork ( usually the Chairman's Report of the initial meeting, as it is often knocked down by creditors. CF typically charge around 20%, I understand.
So, if the inheritance were to arrive today, on a debt of £38k: Fees would look like around £9k - 10k (including nominees fee) and interest around £6k. So £38k plus fees and interest would be around £54k. Less the £9k already paid to the IVA ( and your wife would have been paying some of the joint debt in the meantime-- unless you are both in interlocking IVAs) --- you would be looking at handing over around £45k. This, of course will change as time marches on --- it could be another year before the money is available.
The car ? There should be no concerns about using the insurance payout towards a new vehicle -- that is what it is for. Personally I would leave this problem in abeyance until the IVA has been paid off and done with. But I doubt CF needs to get overly involved in the 'ifs and buts' in the meantime. If your brother wishes to 'gift' you an amount to get a better car, that is his choice and, if you decide to repay him after the IVA has finished, that is your choice.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014 http://foggy.blogs.iva.co.uk
I am also sorry for your loss and agree with Foggy.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk