Wonder if a F&F settlement might work?

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flowerpot
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by flowerpot » Wed Jan 13, 2010 4:12 pm
A relative has offered us £10k to make a full and final offer, because they dont want to see our IVA fail for the sake of our children.

We will have paid in approx £9500 into our IVA shortly, and our debts were originally £65k. I need to get the paperwork our for the exacting figures, but in my best guess, this would mean we have paid just over 25% ( £0.25/£1?)

The reason we are worried about the future of our IVA payments as our fixed rate is due to end later this year and the indications are that the bank of england base rate will go up given the economic recovery. It is likely we will see a massive hike in our mortgage repayments which would have a knock on effect on our income and probably make IVA repayments impossible.

We dont have enough equity at present to shop around for good deals from other lenders and our current lenders have been nationalised owing to the economic problems last year.

In addition, following completion of my education (mature!) i will only be able to take part-time work because of disability, which I previously hoped would have improved, but sadly this hasnt been the case. I'm basing this on the fact that I currently just about cope with a day and half at Uni and even then have struggled and had to extend my education due to my ongoing disability.

One of our children is also awaiting medical assessment for learning disabilities which places further burden both financial and emotionally. Even if I am in better health, it is likely that I am going to be classified as a carer owing to the suspected condition.

On a plus note, there is 1 steady healty full time earner, albeit the income isnt that great!

2010 for us looks like

1)our income will suffer and go down
2)our mortgage will go up
3)and our stress levels, well, you can imagine!!

Its very kind of this relative to come forward with the offer, we havnt told that many people about our circumstances, and I wanted to try and get a feel for weather we might be taken seriously or if we are likley to be laughed out of the hot water!

I am testing the water to see what people think? The other option would be to use to money towards a deposit on a better mortgage deal. I'm unclear if this would even be allowed anyway?

We will keep a close eye on the market to see if moving to a cheaper property would work out, but at present, the signs arnt positive for a number of reasons.

I am loathed to sell up / go for repo and rent just to continue to IVA, tbh i think I would rather go the whole way = bankruptcy.

Thank-you for reading my post, I appreciate any feedback!
Flowerpot.xx

 

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NTF Financial Solutions
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by NTF Financial Solutions » Wed Jan 13, 2010 4:19 pm
Flowerpot
There are no hard and fast rules regarding full and final offers, but one based on the situation described above is definately worth serious consideration. Discuss it with your IP.

 

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kallis3
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by kallis3 » Wed Jan 13, 2010 4:28 pm
Don't forget flowerpot, that some of the money you have paid across will have been swallowed by fees.

I would certainly speak to your IP and make them fully aware of your situation and see what they say as to your offer. If you let them know that the alteranative is probably bankruptcy, they may be inclined to look more favourably upon it.

 

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MelanieGiles
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by MelanieGiles » Wed Jan 13, 2010 4:30 pm
There are two general rules which are looked at when offering a full and final settlement:-

1 Have your circumstances changed to demonstrate that the IVA cannot continue in its present form?

2 What amount can be offered, what is the source of the funding, and what sort of dividend return would this produce.

Creditors will then consider the facts put forward on your behalf by your IP and take a commercial decision as to whether to accept the offer. Creditors are more likely to take the offer seriously when you can demonstrate an actual change in circumstances, rather than a perceived one - but good luck with the offer in any case.

 

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flowerpot
Posts: 144
by flowerpot » Wed Jan 13, 2010 4:32 pm
Thanks James, I know its a long shot given our original debts were £65k approx, but we will otherwise be relying on the bank of england rate remaining low (indications on the news suggest rises around the corner)

Even if a F&F was accepted, we will still have to be careful and weather the base rate fluctuations and manage on a lower income, which is possible if we arnt paying £450 a month on IVA repayments, but will still need to keep a tight reign on matters.

Once again, many thanks for your post!

 

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flowerpot
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by flowerpot » Thu Jan 14, 2010 8:15 am
Thanks everyone, good to have some points if view on this as ever.
Flowerpot.

 

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Shining
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by Shining » Thu Jan 14, 2010 8:17 am
I hope it goes ok for you flowerpot and do let us know x

 

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kallis3
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by kallis3 » Thu Jan 14, 2010 2:59 pm
Good luck flowerpot.

 

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MRBLUESKY
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by MRBLUESKY » Thu Jan 14, 2010 4:35 pm
hi flowerpot i think your definitely,going to need the help of your ip with this one,as i suspect there will be a large shortfall to the creditors based on the original dividend.

 

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kallis3
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by kallis3 » Thu Jan 14, 2010 5:43 pm
Let us know how you get on.
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