Would we be able to do an IVA settlement?

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julie847
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by julie847 » Fri Mar 16, 2018 3:18 pm
Hi, we have completed five years and now into the final year due to lack of equity release. Original debts were 22k, we have paid back 22k, with only the additional monies for fees (5k?). Would it be worth trying to settle F&F of around £1,000? (Husband has depression and has had to go to agency work so unstable time) thanks
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Foggy
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by Foggy » Fri Mar 16, 2018 4:15 pm
julie847 wrote:
Hi, we have completed five years and now into the final year due to lack of equity release. Original debts were 22k, we have paid back 22k, with only the additional monies for fees (5k?). Would it be worth trying to settle F&F of around £1,000? (Husband has depression and has had to go to agency work so unstable time) thanks


A F&F is based on the number of payements outstanding (12) multiplied by the current monthly payment.

Outstanding balances ? You also have statutory interest to take into account ... roughly, on a £22k debt over 5 years (so far) you would be looking at fees iro £5.5k and statutory interest of around £1750 pa -- calculated on the reducing balance ... very roughly £6k. So, to settle, you still owe around £10k plus.

Now, assuming your payments have been pretty much constant you are paying around £365 a month -- so a F&F would be based on the creditors expecting a further £4380. You could probably get away with 4 ....BUT, by the time this all goes through you will have made another 3 payments ( 6 with some firms !) , so the creditors might not think it worth a variation for the sake of a few months.

I thgink £1000 would be too light, bearing in mind they are not really going to be saving anything in admin and it will cost them around £500 in extra fees for a variation meeting to be called.
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