Full and Final Advice - Urgent

NicolaX_2

Hi Everyone,

This is my first post and I really need help. I have contacted the UK Insolvency Helpline but wanted to see if anyone else had anymore advice.

I have contacted my IVA company as a friend has offered to help me out an offer a full and final settlement. It took ages for them to respond and I have been on the phone since the start as they just aren't keeping me upto date.

I received the offer that they were going to put forward and found they had changed the terms and were inconsistant throughout the document, I contacted them and they advised they were aware and sent another document with the updates, this was no longer inconsistant but was not the offer my friend put forward.

The offer was a one off payment and that would be it. They have changed it to 6 more months (which I can't afford, hence the F&F) and then the payment.

I contacted them again to advise that this was not my offer and I wanted it to be updated with te original details. they have now said they will not put this forward.

I believe from what I have been told by the helpline that they CANNOT not put my offer forward, that it is upto my creditors to decide whether the offer is insufficient.

Does anyone know any different? Please help as i'm really upset about this as I have never missed a payment and took this option instead of bankrupcy as I wanted to be responsible and pay back what I could so I could learn from my mistakes.

Doglover

I'd be interested to know which company you are with as my husband and I are thinking of offering a F and F offer.

From what I understand, any offer you make would be subject to review from your IVA company. They then consider it and advise whether it would be acceptable before putting the offer forward. I was told by our company that you can make as many offers as you like without it affecting the IVA.

rog2

The problem, as I see it, with trying to contact ALL of your creditors, individually, is that some will reply, some will even accept your offer, but many may not.
If, therefore, reducing your creditors by, for arguments sake, 50% will help you then great - do it.

There is, however, potentially another option that could be worth exploring - a "Full and Final IVA". This, if accepted by the majority of your creditors, would be fully binding on all of your creditors.

This 'option' may not be 'Top of the Pops' with all Insolvency Practitioners, particularily the 'IVA Factories, but it is worth suggesting to your Insolvency Practitioner - failing which you can always discuss the pro's and cons with one of the Debt Counselling Charities.

Doglover

Sorry to be slow but would you please give a bit more info on

"There is, however, potentially another option that could be worth exploring - a "Full and Final IVA". This, if accepted by the majority of your creditors, would be fully binding on all of your creditors."

Hubby and I have 18 months left to go with the IVA and if we're able to ditch it sooner we'd love to. Is it the same as making a full and final offer?

Thank you

rog2

Doglover wrote: »

Sorry to be slow but would you please give a bit more info on

"There is, however, potentially another option that could be worth exploring - a "Full and Final IVA". This, if accepted by the majority of your creditors, would be fully binding on all of your creditors."

Hubby and I have 18 months left to go with the IVA and if we're able to ditch it sooner we'd love to. Is it the same as making a full and final offer?

Thank you

If you are already in an IVA and wish to come out of it early, for instance if you have inherited some money or a friend/relatve is willing to put up some funds, you may approach your Insolvency Practitioner to discuss the possibility of a "Full and Final IVA".

What, in effect, you would be doing is making a 'Full and Final Settlement Offer' to your Insolvency Practitioner as during the term of your IVA all offers and agreements with creditors must be routed through your IP.

The actual offer that you make would, of course, depend on what you have already paid and the 'remainder' of your IVA period; for example if you have already been in a 5 year IVA for three years and are paying £200 a month, from which your IP deducts say £40 a month, then you would need to make an offer based on the remaining 24 months of your voluntary contributions less the IP fees, ie:

(24 x £200) - (24 x £40) = £3,840.00

This, I stress, is NOT a definitive calculation as the circumstances of each IVA will, inevitably, be different, so it can only be considered as a 'guideline'. You will, in effect, need to negociate with your IP in the same way that you would have negociated with creditors in a normal 'full and final offer negociation.

For those yet to enter an IVA, but can raise up to 30% of their debts, plus around £5-6,000 for IP fees, for example through raising equity on their house, then a "Full and Final IVA" can be negociated from the very beginning. This type of 'F&F IVA' often means that your insolvency period only lasts as little as 12 weeks.

Now, please understand, that none of the above is cast in stone - I am NOT an Insolvency Practitioner (as you will see from my signature, I was declared bankrupt by HMRC) and this is only based on experience that I have picked up since my bankruptcy, so I must stress that anyone looking at the possibility of a 'F&F IVA' should discuss their situation with their IP or with one of the Debt Counselling Charities, such as CCCS, National Debtline or CAB. Please do NOT go to an 'IVA factory' or any other fee-charging organisation for advice.

Doglover

Thank you. Your knowledge is very helpful but don't worry I won't hold you to your friendly words!!

We looked at making a F and F offer but hadn't thought of deducting the IVA company's fees. Presumably their monthly deduction will be in their report. We started at 31p in the pound and now pay a higher amount. The IVA company said that our offer needs to be higher than our current pence per pound but haven't said what it is.

It's with DFD and I wonder if you've come across anyone else who offered early F & F with them and how good they are with negotiation.

Thank you (again!)

Rossa_3

I helped a friend with her IVA offer in January 2008. Based on our experience with the IP this is what we found out.

There are 2 types of IVA, the income based one and the capital settlement one described here as Full and Final IVA. She was offering to sell her house and pay 50p in the £ to her creditors, all credit card companies and one personal loan.

To get this agreed you have to get your creditors who have 75% of the debt to agree. So this DOES NOT mean the majority of your creditors, but is based on how much you owe to each one. In her case, one creditor (personal loan) decided to be awkward and refused to accept her offer. Even though the rest of her creditors were happy with the deal this one creditor could say no as they had more than 25% of the total debt owed to them. Therefore the rest of them didn't add up to the 75% majority required for the offer to be accepted.

So she has gone BR and they haven't got a penny...c'est le vie!

Some things to think about....the IP wants to earn money from you so they will look for the deal that means they get paid. An alternative is to let the IVA fail and then go bankrupt. Check out the posts on the bankruptcy thread for info. And if you want to be cynical about this we were told that the finance companies sell the debts on to the firms of accountants/auditors such as KPMG. They have a tick box form and if you don't tick all the boxes they will decline the offer. So you aren't even dealing with the company you thought you had a relationship with.

Nicola, while I admire the fact that you want to learn from your mistakes and pay what you can please remember that to the companies you are dealing with this is BUSINESS. It is not personal, though that is easy to say as we all get emotionally involved in these situations which is quite natural. Difficult as it may seem, please try and take a step back from your situation and try and look at it logically. Otherwise you may be even more disheartened with the whole process.

And just so you know I've been there, I was made BR is '94 and in those days it was for 3 years so my discharge was in '97.

IMO (and I know you may think I am biased) a bankruptcy, though a frightening prospect to most people is often a shorter and cleaner way out of the debt situation you may find yourself in. One thing I have noticed on this forum is the relief felt by the people who opt for BR and the problems being faced by those that opt for an IVA. That says it all.

Good luck whatever you decide to do.

louiser123

i wholeheartedly agree with rossa, i had the same situation in 2000 we had an IVA which was 250 per month i lost my job and we just could not afford to pay the iva, we tried to negotiate with creditors( our ip was actually very good and it was him that suggested letting the iva fail and being declared br) creditors in the end like many then got nothing. but the relief of it was huge even though it was still a stigma and classed as a very bad thing even in 2000.
it really does make ny blood boil when there are iva companys out there who dont act for the debtor, after all you are paying them to handle and negotiate on your behalf and creditors well i could go overboard with them!!
after the long and lengthy negotiations we had to go through and two creditors refusing to agree to even having an iva, two i might add who were owed the least so thier view didnt count in the end anyway. i can actually say and i am not in the least bit ashamed of saying it i was glad they got nothin in the end because after all what we had paid previously more or less covered what we actually borrowed without interest anyway and i can happy say the day i went br i pretty much stuck 2 fingers up at the creditors and felt they had got what they deserved. they had hounded for months, threatened and refused to come to any agreement.

Radiantsoul

rog2 wrote: »

If you are already in an IVA and wish to come out of it early, for instance if you have inherited some money or a friend/relatve is willing to put up some funds, you may approach your Insolvency Practitioner to discuss the possibility of a "Full and Final IVA".

You need to be careful with inheritence as some IVA agree that any windfalls or inheritance will be paid to creditors.

rog2

Doglover wrote: »

It's with DFD and I wonder if you've come across anyone else who offered early F & F with them and how good they are with negotiation.

Unfortunately, Doglover, DFD do not have the best reputation when it comes to 'negociating' or, indeed, the general level of service that they give to their 'clients'.

I think that Rossa summed it up by saying 'the IP wants to earn money from you' This is most certainly the case with DFD.

rog2

Radiantsoul wrote: »

You need to be careful with inheritence as some IVA agree that any windfalls or inheritance will be paid to creditors.

That is a very valid point, Rs.