Early settlement of IVA

mickmustardly

Hi,
I'm posting this to get advice for a friend who is currently 18 months into her IVA.
Her debts were around £24000 and her IVA is paying back £230 per month for 5 years totalling £13800, she has paid around 18 months of her IVA leaving around £9660 to pay.

So the thing is she has received a settlement from her work for around £14000 and wants to clear her debt, the settlement is a one off just and is for underpaid wages over a long period of time.

Would like advice on wether she should make an offer of around £9000 to settle the IVA or would they be looking all the money to give to the creditors?
Thanks for any advice on this,
Thanks,
MIchael

leeds4ever6

offer 5000 as a settlement, and just say its a loan from a family member, do not mention the real reason you have the money!

Charco_2

Also known as fraud!

The real reason she has the money I fear would mean that she is obliged to hand it all over... Hopefully I'll be back with something more helpful in an hour!

leeds4ever6

charco

offering money isnt fraud at all. 5000 is a good offer, all i ment was tell them a family is willing to help you out and they can offer this amount to pay off your iva via a settlement.

Charco_2

Not telling them where the money came from is fraud - there's no two ways about it! Worse than not telling them, you're actually advising them to lie! This is not worth jail time!

Anyway, the money will show up on wage slips that will have to inspected in order to produce the final annual review if a full and final is agreed.

The £13,800 is neither here nor there, her total outstanding debts were £24,000 and that's the figure to work off. There would also be Statutory Interest and IPs fees which could increase the total outstanding significantly.

If your friend had been paid properly in the first place by the civil service she may not even have run up the debts, the debt she did run up then could be viewed as an advance on the money she has now received so her creditors are entitled to the money... I'm sorry that's not going to be the news you were looking for!

HOWEVER...

I know our company did do F&F for a small few clients in the same boat (I'm guessing this had something to do with Civil Servants not being paid properly in Northern Ireland since late 1960s).

NEGOTIATE!!!!

Athough technically your friend should have to hand over the full amount AND continue repaying her IVA, there's a good chance she'll be able to retain a couple of thousand and have the IVA settled as full and final... just please dont attempt fraud!

Same rules for F&F apply: Get a good story together, any possible reason why you may not be able maintain ongoing repayments, and a possible reason why you would need to retain monies.

Definitely negotiate with your IP but please don't lie.

mickmustardly

HI,
Thanks for your replies.
A £5000 offer to settle would be great but as you say payslips would be looked at.
What does F&F stand for?
I suggested to her to lift £5000 and give to her folks and say to the IP that she owed them that money and offer the rest as a settlement payment of £9000 which is close to the remaining payments due in the IVA and hope for the best.
It would be hard to think of a reason of not being able to continue to make payments in her IVA, her IP has been hard to work with from the start so am thinking negotiations may be difficult.
I was thinking about maybe if she used citizens advice to try and negotiate a settlement.
Thanks again.

debtinfo

She needs to look at her agreement and see what it says, as charco says it may be the case that the whole lot needs to be handed over, if that is the case then there is no negotiating to be done