Unproven Creditor Claims

clairev

We are in our first year of our IVA and have received a letter this morning from the IP which looks like it has been sent out to all our creditors saying a distribution to creditors was due last month but they are unable to do so because there are unproven creditor claims outstanding.

Tried ringing the office but of course they are shut. If anyone out there can explain what this means I would be very grateful.

Charco_2

Your creditors are going to receive Xpence in every £ that you owed them. So if the dividend that you have predicted for your creditors is say "30p in the £" then that's what each creditor will receive in the end.

To receive their dividend's, your creditor's need to submit a "Proof of Debt" to the IP so that the IP knows how much money is available to each creditor and how much individually each creditor deserves out of this first payment.

If there is £1,000 in the pot at the minute and you have three creditors they don't just get £333 each - they will be paid their percentage share!

So if one creditor makes up 50% of your toal debt, then that creditor will get £500 of this first payment. Another creditor makes up 30% of the debt so they'll get £300 from this payment. And the third creditor will get their 20% which is £200.

But without the Proof of Debts' from the creditors then the IP can't know who is due what!

I don't think that this is something for you to worry about!

clairev

Thanks Charco. We have one company who has said they will not be claiming under the agreement - does that mean they are probably writing the debt off? Also if some companies don't prove the debt what will happen? We are not actually insolvent. We have enough equity, just, in our house to pay everything in full and the Inland Rev have added a clause inthe IVA to say if there is anything outstanding at end of IVA we have to sell our house to settle in full.