What would cause an IP to reject an IVA proposal?

Get expert opinion. This is the place for new questions to be posted.
  • 1
  • 2
24 posts Page 1 of 2

 

User avatar
Sinking Fast
Posts: 541
by Sinking Fast » Sun Jan 17, 2010 8:34 pm
Hi All,

Can i ask, out of curiosity than anything else; what would give cause for an IP to reject proposing an IVA to your creditors?

Many thanks.

 

User avatar
Adam Davies
Posts: 14596
by Adam Davies » Sun Jan 17, 2010 8:37 pm
Hi
If they felt that it was likely to be rejected or that all information had not been supplied
Regards

 

User avatar
Sinking Fast
Posts: 541
by Sinking Fast » Sun Jan 17, 2010 8:50 pm
Thanks Andy,

What then would give your chosen IP a feeling that creditors would reject your proposal?

Is it certain creditors who are likely to reject your application?

If so which?

Many thanks.

Andy Davie wrote:


Hi
If they felt that it was likely to be rejected or that all information had not been supplied
Regards

 

User avatar
Adam Davies
Posts: 14596
by Adam Davies » Sun Jan 17, 2010 9:02 pm
Hi
If your payments and dividend made an IVA not viable, if creditors preferred a debt management route due to the disposable income paying debts within 5/6 years, equity level too high, payments made to cover a shortfall in an investment property etc etc
An IP would only propose an IVA if they felt that it's likely be accepted and there are no creditors that stand out as likely to reject, it all depends on the offer that is made.
Regards

 

User avatar
MelanieGiles
Industry Expert
Posts: 47612
Contact
by MelanieGiles » Sun Jan 17, 2010 10:27 pm
Post deleted by author - as it was deemed not to be relevant to subject or helpful!
Last edited by MelanieGiles on Mon Jan 18, 2010 12:03 am, edited 1 time in total.

 

User avatar
kallis3
Forum Expert
Posts: 71966
Contact
by kallis3 » Sun Jan 17, 2010 11:00 pm
What happened there Mel?

 

User avatar
MelanieGiles
Industry Expert
Posts: 47612
Contact
by MelanieGiles » Mon Jan 18, 2010 12:03 am
Ooops - I decided to post, and then decided against what I was going to say as I did not think it was helpful. At the risk of incurring the wrath of the moderators, I will now delete my half finished post. Thank goodness for editing !!!!!!!!!!!!

 

User avatar
D&G
Posts: 167
by D&G » Mon Jan 18, 2010 10:59 am
I think this needs answering properly, so i thought i would post to bump it back up. I know someone who has just got an iva who has had a gambling problem. If they stated this in the iva would they of been allowed? I am not going to ask because they do not know that i know they have an iva. What if debts where run up in a quite short space of time, say taking regular cash advances from credit cards or loans to pay off unofficial debts? What if someone was insolvent for quite a while, burying there heads and not facing upto it, still using credit from month to month? Paid off friends and family increasing the amount being in debt to companies? The list goes on but they was just some of the scenarios that i could think of. A lot of people will worry about these things.

 

User avatar
Michael Peoples
Industry Expert
Posts: 15188
Contact
by Michael Peoples » Mon Jan 18, 2010 11:58 am
A previous gambling problem is not a bar to an IVA but if the client is still gambling an IP would be loathe to act. If however the client has ceased gambling and perhaps going to Gamblers Anonymous then a proposal could be drafted.

IPs have to take a view and report to creditors as to the client and the validity of a proposal. If they become aware of preferential payments to family members or other actions that could be overturned by a Trustee in bankruptcy they will make the creditors aware in the IVA proposal or can refuse to act.

 

User avatar
D&G
Posts: 167
by D&G » Mon Jan 18, 2010 12:18 pm
Scenario 1 Person takes out say five thousand pound loan a few months before iva too make sure elderly parents get some of there money back. Can enjoy it before they die. Would this hinder iva. Scenario 2 Person owes someone money takes numerous cash advances from credit cards over a short space of time. In which to pay off said person. Several months later needs iva. Scenario 3 Home improvements need to be done person gets more money on mortgage for said improvements. Only to go for an iva straight afterwards. These are just some of the things that some people have done, may need to do or are thinking of doing before an iva. Would these things affect an iva being approved.

 

User avatar
Michael Peoples
Industry Expert
Posts: 15188
Contact
by Michael Peoples » Mon Jan 18, 2010 12:49 pm
Scenario 1. This could be overturned in bankruptcy but depending on the situation of the parents an IP may be prepared to prepare an IVA and just disclose the preference. Creditors can then decide whether they want to accept or reject the IVA.
Scenario 2 would be difficult to discover unless the client actually told the IP what he/she had done. IPs do not investigate the credit card statements of clients going back months. Most clients take cash advances as they get into difficulties and use them to live or meet pending direct debits.

Scenario 3 is straightforward. If they borrowed money for essential home improvements it could make an IVA more viable as there would be no need to vary the arrangement to allow roof repairs for example at a later stage. In addition, the debtor will have enhanced the valus of the property which will be of benefit to creditors when the equity is released later.

 

User avatar
kallis3
Forum Expert
Posts: 71966
Contact
by kallis3 » Mon Jan 18, 2010 3:14 pm
I used to withdraw cash from the hole in the wall on my mastercard, and then walk into the bank and make my minimum payment. I did this for a few months before admitting defeat.

I had no problems getting an IVA.

 

User avatar
Sinking Fast
Posts: 541
by Sinking Fast » Mon Jan 18, 2010 5:58 pm
This is exactly what Im talking about Kallis - you could in fact be describing exactly what I have done this morning.
Maybe I should have clarified this in my initial posting.

Anyway taking the action you did Kallis; was there a problem in you proposing an IVA?

I am in no way trying to uncover how far down the fraud/deception line you can go down before an IP says NO.
I have not been reckless, but since being made redundant I have found myself "recycling credit" to get by.
I am now taking action, and want to make sure all my ducks are in a row before I go for it.

Many thanks.
kallis3 wrote:


I used to withdraw cash from the hole in the wall on my mastercard, and then walk into the bank and make my minimum payment. I did this for a few months before admitting defeat.

I had no problems getting an IVA.

 

User avatar
kallis3
Forum Expert
Posts: 71966
Contact
by kallis3 » Mon Jan 18, 2010 6:54 pm
I had no problems at all.

 

User avatar
D&G
Posts: 167
by D&G » Mon Jan 18, 2010 7:34 pm
I hope you was not reffering to my comments as fraud/deception. But they are genuine things that folks will worry about. There are things like home improvements etc that people will worry how will i do these things when in an iva. Then you are getting advised to try and sort this out before entering an iva. I was trying to get answers to mine and others obvious concerns. If that is how concerns are interpetrated then i shall not bother asking anymore questions.
  • 1
  • 2
24 posts Page 1 of 2
Return to “Ask IVA Forum and Industry experts”

Who is online

Users browsing this forum: No registered users and 9 guests