Paying The Creditors

brickhouse

I am in a position to pay off my creditors and file for an annulment as soon as possible. Does any one know the situation in terms of the final settlement figure? Do i break any rules by negotiating a full and final settlement figure with my creditors? Or am I now legally bound to pay the full settlement figure only?

Best Regards,

BrickHouse

rog2

Hi brickhouse - I'm not sure on the exact process, but I do know that you CAN do this through an Insolvency Practitioner, but I think you can also do it direct through your OR/Trustee (the Trustee is usually also an IP).
There are administration fees, and I'm pretty sure that you need to pay the FULL amount.
Why not ask CCCS?

NekoZombie

I suspect full only - but we'll see what the others say

brickhouse

I mentioned it in passing during my interview, that I'd once been offered a final settlement offer by one of my creditors and I'd go back to them and see if that offer was still on the table. My interviewer told me that he would "object" to that if he were at court at the annulment as it was the full debt I was expected to be settling. I could not understand the logic of it. I have wondered about this. If the creditor is happy to accept less than the full payment, why should bankruptcy alter this. It seems unnecessarily punitive to make me have to pay the full debt because of the bankruptcy.

I'll try CSSS as you suggested. I was just going to write out cheques to the creditors. The Interviewer didn't tell me it had to be done through him.

Awaiting others input with baited breath!

Best Regards,

BrickHouse

fermi

You can reach a 'Voluntary Arrangement' with creditors in conjunction with the courts and the OR/Trustee and a subsequent annulment through the courts.

However, if you are in a position to meet all the bankruptcy debts and fees in full then the I would suspect the creditors may be reluctant to reach a partial settlement under this arrangement. But if you don't ask.....;)

I would read this: Can my Bankruptcy be Cancelled

and then get in touch with your OR/Trustee to discuss the viable options in your case since this will have to go back to court at some point anyway.

rog2

I too find the attitude of your interviewer, I presume you mean OR, strange. I don't see on what grounds he COULD object to an annulment - even if it were not FULL payment.
I have heard, and I will research this, that the offer needs to come from a third party, if you are still in your bankruptcy period, as if the offer is funded by you, directly, there could be some question over legal ownership of the funds.
I see no problem if you are discharged, or if a family member is financing the offer.

brickhouse

Sorry if I caused confusion. He did not object to an annulment. He was actually very supportive in outlining my options for an annulment. I cannot fault him in that respect. But I was taken aback at the idea that whereas before bankruptcy, I could have negotiated a settlement figure that was a percentage of the total debt, he was telling me that if I attempted such a negotiation, then he would "object". The way I see it is that if the creditor is happy to accept a percentage as a final figure and if the creditor confirms that in writing, then why / how should this be a problem at the annulment hearing.

And yes, by Interviewer I mean OR. I want to pursue an annulment on the grounds that the debts have been paid to all creditors. Debts paid whether for the full amount or for a percentage of the full amount, as long as the creditors are happy.

BrickHouse

rog2 wrote: »

I too find the attitude of your interviewer, I presume you mean OR, strange. I don't see on what grounds he COULD object to an annulment - even if it were not FULL payment.
I have heard, and I will research this, that the offer needs to come from a third party, if you are still in your bankruptcy period, as if the offer is funded by you, directly, there could be some question over legal ownership of the funds.
I see no problem if you are discharged, or if a family member is financing the offer.

brickhouse

The thing is, I was being told not to ask. And there is no way the creditors know whether I have the full amount or not. They never really know when someone tries to make a partial payment if that is indeed all they have or not.

BrickHouse

fermi wrote: »

However, if you are in a position to meet all the bankruptcy debts and fees in full then the I would suspect the creditors may be reluctant to reach a partial settlement under this arrangement. But if you don't ask.....;)

quote]

wherediditallgo

I suggest you also have a look at Fast-Track Voluntary Arrangements (FTVA) here. 75& of your creditors have to approve it, & it costs you to do it, but if you're prepared to offer your creditors a sum they'd find hard to refuse (I think 75% should do it) & if you're offering the lump sum up front rather than monthly payments, then I think you have a good chance of success. There's nothing to say that you have to pay off the complete debt, only that you face stiff action (being made BR again or court action from your creditors) if you don't make the agreed payments. If you've already had the inconvenience etc of being BR for a while, I'd say that goes some way to making up the 25% difference.

I went BR owing some £22k, & I've been BR for 4 months (a third of the normal time) & I've been paying into an IPA. Unless my finances drastically improve, my creditors will receive about 8% of what was owed by the time my IPA finishes. If I came into enough money to be able to now make a settlement offer on those debts, I'd be offering 75% of the total, hoping for something off the amount. A "discount" is the wrong word, but I'd want my 4 months of BR and my IPA payments (all paid before the due date) to be taken into consideration. If 'full and final' was an option before BR, I don't see why it shouldn't be one after it. As fermi says, if you don't ask you won't know.

brickhouse

I'm in the unfortunate position of being a home owner. I'm trying not to lose everything for a relatively small figure.

BrickHouse

wherediditallgo wrote: »

There's nothing to say that you have to pay off the complete debt, only that you face stiff action (being made BR again or court action from your creditors) if you don't make the agreed payments. If you've already had the inconvenience etc of being BR for a while, I'd say that goes some way to making up the 25% difference.

I went BR owing some £22k, & I've been BR for 4 months (a third of the normal time) & I've been paying into an IPA. Unless my finances drastically improve, my creditors will receive about 8% of what was owed by the time my IPA finishes. If I came into enough money to be able to now make a settlement offer on those debts, I'd be offering 75% of the total, hoping for something off the amount. A "discount" is the wrong word, but I'd want my 4 months of BR and my IPA payments (all paid before the due date) to be taken into consideration.

brickhouse

I had very helpful chats with a lovely young man at CSSS. You'd have thought we were in this mess together, he was so helpful and patient. I didn't feel like one of I guess thousands of people ringing in. It was great but the consensus was non-conclusive.

Encouraged, I then rang the National Debt Help Line. I was ab it alarmed at all the questions I had to answer first and wished I'd phoned on a withheld number. They wanted chapter and verse. I pointed out that the damage was done, I was already bankrupt so the question of priority and credit debts didn't come into it now. But she did say, after consulting with a colleague, and without a shadow of a doubt, that I could not negotiate a settlement once made bankrupt. So, at least I know that.

So, now I am going to draft a letter to each creditor asking for confirmation of the amount borrowed and a written assurance that the file will be marked settled in full and that they will amend it with the credit agencies. Is there a standard wording for this type of letter? The letter at the National Debt Help line is for those in a position to negotiate final settlement figures.

BrickHouse