11 months in IVA wanting to offer F&F

becbecm

Hello all,

It’s been a while since I’ve been on this thread. Just been plodding along with the IVA. 
I’m 10 months in (11 in a few weeks time) is this okay to offer a full and final settlement? 

I have many personal reasons as to why I want to just finish this IVA asap and a family member is willing to pay this off for me. By month 11 I will have the outstanding balance of £4410 if I offer this how likely is it to be accepted? 

I have out this forward to StepChange who deal with me and I’m still awaiting a response which is nerve wrecking. 

Just wondering how many of you out there have done this and how was life after? Of course I know the whole 6 years insolvent situation. 

MrFrugalFever

I have recently just settled my Iva early after just 3 years and 10 months with a F&F offer. I started the process in June and have only just got my completion certificate through from the IP (CreditFix).

They called a variation meeting with the creditors to put forward my offer of 85% of remaining payments which was declined. The creditors indicated that they would accept an offer of 100% of remaining payments to yield a specific dividend. I revised my offer to match and as agreed it was accepted.

in short, you have a very high success of getting it approved if offering 100% of remaining payments. 

Can I ask what your total debt was at the start of the IVA? 

becbecm

MrFrugalFever said:

I have recently just settled my Iva early after just 3 years and 10 months with a F&F offer. I started the process in June and have only just got my completion certificate through from the IP (CreditFix).

They called a variation meeting with the creditors to put forward my offer of 85% of remaining payments which was declined. The creditors indicated that they would accept an offer of 100% of remaining payments to yield a specific dividend. I revised my offer to match and as agreed it was accepted.

in short, you have a very high success of getting it approved if offering 100% of remaining payments. 

Can I ask what your total debt was at the start of the IVA? 

Hi there,

Turns out I got my payments mixed up and after paying my 1st November instalment of £90 I will have the outstanding balance of £4500 which 3rd party is still willing to pay so I have out this forward to StepChange this is 100% so I’m quite sure it’ll be alright. 

The start of my IVA I was in around 13k worth of debt but with my not huge income and renting on my own it was drowning me I was paying out £500+ on debts a month and struggling. 

MrFrugalFever

I wish you the best of luck, the worst that will happen is your creditors will vote NO at the variation meeting....not the end of the world.

obviously not knowing your income or personal situation at this point it’s difficult to comment but I do struggle to see why you’ve been advised / entered in to an IVA. Nonetheless, you’re here now.

one thing that I will say though is that after 11 months of my IVA I don’t think reality had truly set in and if I had re-entered the financial mainstream market as it were I think I would have possibly lapsed a little bit. After 2 years I felt psychologically in control and conditioned to behave with my spending, consequently, I have 1 credit card with a limit of £250 to rebuild my report that gets paid in full and I have spare money left each month now....the polar opposite to pre-IVA for me. In short, I am just wondering whether exiting your IVA so early on will actually benefit you, as hard as it is.

becbecm

MrFrugalFever said:

I wish you the best of luck, the worst that will happen is your creditors will vote NO at the variation meeting....not the end of the world.

obviously not knowing your income or personal situation at this point it’s difficult to comment but I do struggle to see why you’ve been advised / entered in to an IVA. Nonetheless, you’re here now.

one thing that I will say though is that after 11 months of my IVA I don’t think reality had truly set in and if I had re-entered the financial mainstream market as it were I think I would have possibly lapsed a little bit. After 2 years I felt psychologically in control and conditioned to behave with my spending, consequently, I have 1 credit card with a limit of £250 to rebuild my report that gets paid in full and I have spare money left each month now....the polar opposite to pre-IVA for me. In short, I am just wondering whether exiting your IVA so early on will actually benefit you, as hard as it is.

I understand where you are coming from, my salary at the time was 21k, I had exhausted all my forms of borrowing that I couldn’t borrow anymore at all. I considered everything at the time like consolidation loans etc but nothing was possible for me.

Bankruptcy wasn’t a route I wanted to go down, I’m now 29 but yes I really didn’t want to go down this route but it was the only way I could see myself out of this situation. 

I spoke to a few companies before settling for StepChange and they really have been the best, everything was smooth and they gave me all options and advise etc. I really was the end of my tether and the only way out I could see working was the IVA. I do not own property etc so it was straight forward and of course one day I want to be a home owner and now yes I have to wait 5 years etc but I’m well aware of this.

I know it probably sounds hard to believe but actually in these 11 months I really have learnt my hard learnt lesson and I feel money is no longer my enemy and I want to work hard to be financially sound. This is a change of lifestyle and habit and my god I’ve really done some growing up in this time. The stress mentally going through this has been unreal and I feel a huge light at the end of the tunnel so I really feel like it’s putting me on the right tracks. 

Doing my i&e was already a huge wake up call and I couldn’t continue living the way I did, I was burying my head in the sand when it came to my finances. 

I’ve put forward the £4500 offer and we’ll see what happens.  

MrFrugalFever

You are amongst like-minded people here who are currently pre-IVA & considering, during IVA or just out the other side of it. What you have felt and been through is all too common and I think financial stress really is up there with the worst forms of psychological pain.

The process of offering a F&F settlement and getting full closure with an official completion certificate shouldn’t take any longer than 6 months. Once you have your completion certificate you will be entering the mainstream financial market again.

Your credit report will stay damaged until the 6th year anniversary of your IVA start date and default start dates at least, but you can now (if F&F successful) start trying to rebuild a history of repaying things back, little by little.
as tempting as it may be, don’t be rushing out for a credit card or loan just to do this, think it through really carefully! I have just entered in to a contract with Vanquis on a 29.9% APR Chrome MasterCard, I requested to have a limit of £250, with a view to ALWAYS paying off in full.

one thing the last 4 years has taught me is the value of money and id almost go as far as saying I’m now debt scared, scared to have a CC or Loan for fear of slipping back in to old habits.

I too am working towards being a home owner and now I am free of the IVA terms I can start to build a credible history with all 3 CRA’s, a suitable deposit and start planning for my very different financial future.
i have done much research about mortgages post-IVA and it appears that it is indeed possible to get back on track (particularly after all items have dropped off the CRA’s), albeit with slightly higher APR’s to start. There are, however, some lenders who insist on asking questions such as ‘have you ever entered in to an IVA or been declared bankrupt’. Now that’s not putting a timescale on things so I (we) would have to answer that with a truthful yes. Those lenders may well have particularly stringent criteria, however, it appears that a mortgage specialist who understands the many lenders is a great place to start, along with a sizeable deposit (10%+).

If stepchange suggested the IVA then I’m sure it was the absolute best solution, they are highly recommended throughout the forum. I went in to my IVA with an unmanageable £36k but I earn twice what you do, so perhaps relative? It’s not my proudest moment but I can honestly say, all the while I have a breath in my body I will not allow myself to get to that point again (it was a long term build up over 10+ years).

Again, good luck with the F&F offer, do keep us posted and do make use / participate in this forum occasionally where you can, it’s a great source of info and keeps one’s mind focused!

sourcrates

IVA`s do not work like a conventional repayment plan, the amount you would most likely have to pay to settle the arrangement would be your monthly payment x 60, equalling a 100% return for your creditors.

Why would they accept anything less ? 

Unless you have a very good reason, its very unlikely they will accept anything less than full repayment, why should they ?

Also you are only 11 months in, you won`t even have touched your debts as yet.


There are three separate fees involved in an IVA -

A nominee’s fee, a supervisor’s fee and disbursement costs.

The nominee’s fee is for setting up and agreeing the IVA with you and your creditors and is normally a fixed value fee. 

This will be taken before any payment is made to creditors.

supervisor’s fees are for the ongoing management of your IVA and are normally on a percentage basis and spread over the duration of your IVA. 

There are also disbursement costs which cover all the miscellaneous costs of setting up and maintaining an IVA, such as registration fee, insurance, etc.

IVA example.

Typical monthly repayments (60 months) £300 Total paid by borrower (including fees) £18,000 Nominee’s fee £1,704 Supervisor’s fee £3,149 Supervisor’s costs £290 Total amount paid to creditors £12,857 (41%)

Fee`s are taken first, then what`s left is disbursed to your creditors, creditor disbursements can vary, but certainly will not be made within the first year.

becbecm

sourcrates said:

IVA`s do not work like a conventional repayment plan, the amount you would most likely have to pay to settle the arrangement would be your monthly payment x 60, equalling a 100% return for your creditors.

Why would they accept anything less ? 

Unless you have a very good reason, its very unlikely they will accept anything less than full repayment, why should they ?

Also you are only 11 months in, you won`t even have touched your debts as yet.


There are three separate fees involved in an IVA -

A nominee’s fee, a supervisor’s fee and disbursement costs.

The nominee’s fee is for setting up and agreeing the IVA with you and your creditors and is normally a fixed value fee. 

This will be taken before any payment is made to creditors.

supervisor’s fees are for the ongoing management of your IVA and are normally on a percentage basis and spread over the duration of your IVA. 

There are also disbursement costs which cover all the miscellaneous costs of setting up and maintaining an IVA, such as registration fee, insurance, etc.

IVA example.

Typical monthly repayments (60 months) £300 Total paid by borrower (including fees) £18,000 Nominee’s fee £1,704 Supervisor’s fee £3,149 Supervisor’s costs £290 Total amount paid to creditors £12,857 (41%)

Fee`s are taken first, then what`s left is disbursed to your creditors, creditor disbursements can vary, but certainly will not be made within the first year.

Thank you for this, surely StepChange wouldn’t put this forward of my offer if they didn’t think it was likely to be accepted? 

I have read up numerous sites about f&f before considering this and the usually formula shows the remaining monthly payments x the amount monthly paid. 

If I’m wrong I’m wrong but I have put through the offer now so all I can do is wait to see what happens. 

MrFrugalFever

Worst case your offer is rejected and you carry on with the IVA, as far as I’m aware there’s no real limit to the amount of times an offer can be put forward on the table, however, I would obviously exercise common sense and caution here. The creditors may also counter offer and suggest a dividend yield they would accept giving you an opportunity to re-evaluate your offer. 

One thing to consider is, if your offer is rejected and the creditors propose an amount which, let’s say for arguments sake, exceeds £4,500 significantly, I would question whether an F&F is right at this time. Having parents/friends/relatives offer lump sums to settle can, in some instances, be a whole world of bother in itself.

becbecm

Thank you, I realise this too it’s asking for too much from 3rd party so if it exceeds my offer of £4500 it’s most likely a no 

becbecm

A MASSIVE thank you to everyone on the forum. 

My Iva offer has been accepted! 🥳 Today at 10am I am finally clear. 
No more payments I couldn’t be any happier. A chance for a fresh start with no more debt to worry about. I even started a savings account to build my future. 

I couldn’t have done it without the support of friends, family and this forum.