IVA Final Repayment Options

lbell_3

My boyfriend has an IVA and is just about to complete his third year of repayments. The total duration of the IVA is six years and his repayments are set at £300 per month. He has just been to hospital and is now on the waiting list for major knee surgery so is likely to be out of work for 9-12 months starting in early March next year. The problem comes in the fact that he will not be receiving an income at all as he only receives 15 days sick pay in any 12 month period.

As he has 36 payments remaining at £300 per month, that leaves around £10,800 left to pay and he will be able to afford three more payments before he stops receiving an income. Does anyone have any advice on offering a final offer for the remaining debt and what would be an acceptable offer? His parents have some spare money and have offered to pay off the remaining debt but they only have £6,000 free and this is all he can scrape together. If this offer is not accepted then he will have no option but to fail on his IVA and then stare down the barrel of bankruptcy.

Has anyone else had any experience with this kind of situation or any comments that might help with his predicament?

Thanks for reading and look forward to receiving your sound advice soon.

Liz

Charco_2

Considering the circumstances, £6k would be a rather generous offer and would be likely to be accepted by his creditors... If that is what he decides to do then don't let his IP talk him into finding more and more lump sum, £6 is what he can afford (with the help of his parents) so that is all he should offer. It's between him and his creditors then to agree. He offers and his creditors accept or reject.

Hurry up and offer it now, rather than waiting for him to pay three more months and then offer it... you could save those three months payments for yourselves once the ball is rolling on this new offer!

As I said though, I think £6k would be a good offer!

lbell_3

Thanks for your advice Charco,

Is it wise to offer this amount now rather then when is out of work? He is currently working and meeting his IVA payments and is not likely to be out of work and without funds till early March next year. Wont the creditors require some sort of evidence of the circumstances? He is not likely to receive a doctors note confirming he is off work till he has the operation in March and therefore will not receive a note from his employer confirming he is on statutory sick pay for the foreseeable future.

Can this offer be made now, even though he is working and is able to make his IVA payments for the next three months? How would this need to be put forward in the current circumstances?

Charco_2

Definitely start now... keep up his repayments while he can but negotiate now.

THAT GOES FOR EVERYONE:
As soon as you foresee a problem looming on the horizon for your ongoing IVA contributions, contact your IP. This will give the IP time make suitable adjustments to the IVA so that it can run that bit smoother. Dont just wait until the problem arises.

If you see a problem six months down the line (or six weeks), warn your IP and discuss possible solutions. If there are no solutions (very extreme and unlikely) then there's no point in paying your IVA for 6 months only for it to fail when the problem does arise. It's much more likely though that your IP can start to organise a solution to the problem (be it a payment holiday, or a reduction in contributions, or a F&F offer, or whatever).

So Ibell, start negotiating now. Warn the IP of the problem coming and how your partner would like to address it (lump sum offer of £5k/£6k from third party funds - parents). Even though he wont have a sick note, surely he has something to indicate that he will be undergoing surgery that is likely to limit his earning potential for a lengthy period!? Even without proof you can start the process although you'll perhaps have to show proof in time!

(Also, if you can get this agreed and done and dusted in February then you could save yourselves the february contrbution)