Loan to Parent

Likesplants

Sorry I'm posting a lot of questions, but things keep coming to mind that I'm not sure of and would appreciate any advice please. When I started IVA I had a loan to my mum that IVA firm said I could use money from my allowable expenses to still pay if I was able to cut back etc. so they didn't include this loan in my IVA. Some months I was able to cut back a bit and pay my mum some money but other months I couldn't afford to. She has also helped me out during last two years lending me odd £20 or more here and there. Which I then pay back but end up borrowing again. But what worries me is my bank statements will show this, even though she ends up lending it to me again. I've now learned about preferential creditors which I'd never heard of before. So will OR ask my mum to repay what I've paid her on and off even though in most cases I end up borrowing it again? Or in some cases it's like she's lent me £20 for shopping. And I was paying her by going short on things from my allowable expenditure and stupidly making myself short. So it wasn't as if I had a magic pot to pay her from and I was still paying my IVA. I'm worried because IVA firm said I could pay her something from my allowable expenses money each month, but I don't want it to be seen that I paid her and not other creditors as I've not paid her in full. Also she's in her 80s and I'm worried OR will ask to see her bank statements and involve her and say she has to pay the money back. The shock of this would make her ill as she's only got a state pension and no savings. I wish I'd included the loan in IVA and not listened to IVA company. I've read about reversing transactions but I'm not clear how far they go back. I just don't want my mum to suffer for my mess.

tigerfeet2006

I'm guessing we are not talking 1000's here? Are we taking £20/50/100 here and there and not regularly? If so then you won't have a problem.

Likesplants

The original loan was £1500. I paid £100 some months but I'd end up re borrowing it as I'd use my housekeeping budget etc then be too short. Then just odd £20 or £50 here and there that I borrowed. But that wasn't every month. I can't understand why the IVA company said to use my allowed expenditure if I could, to pay it back. Why didn't they just include it in the creditors list. It says in my IVA paperwork about the loan and it's listed under my monthly outgoings. Originally in the IVA proposal the IVA company deducted the monthly payments to my mum off my left over monthly income but the creditors refused this and that's why IVA firm added the £100 onto what I have to pay into IVA each month, but said if I can scrimp and save from what they allowed in budget I could pay her from that. But I don't have proof of that conversation in writing as it was over the phone. I do have IVA paperwork though that mentioned loan to my mum.

Likesplants

I'm just petrified now they will make my mum bankrupt and force her to sell her house as that's the only way she could repay it.

tigerfeet2006

You will have no problems with it so don't panic. If the OR asks then you tell him what you told us, simples :-)

longtermplanner

There is nothing wrong with you paying your mum small amounts of money to repay loans because you were in an IVA. The OR is not going to think twice about this. This is not a reason to worry.

Likesplants

Thank you so much for putting my mind at rest over this.