can you come out of an iva

fermi

james23_uk wrote: »

Only three ways you can end an IVA:
1) to declare yourself bankrupt,
2) a creditor in the IVA petitions for your bankrupcy,
3) you have a full and final payment accepted to clear the IVA.

Not quite.

An IVA will end (be failed) if you fail to keep up payments as per the agreement.

If that happens then you can go with you option (1), or see if the IVA company will go for option (2). Not all IVA companies/IPs will retain funds or include a duty to do option (2) in the agreement.

If neither of those apply, then you be returned to dealing with the creditors yourself.

james32_uk

fermi wrote: »

Not quite.

An IVA will end (be failed) if you fail to keep up payments as per the agreement.

If that happens then you can go with you option (1), or see if the IVA company will go for option (2). Not all IVA companies/IPs will retain funds or include a duty to do option (2) in the agreement.

If neither of those apply, then you be returned to dealing with the creditors yourself.

Thanks - good info. In your experience do creditors/IPs tend to push for bankruptcy? I would have thought they would.

fermi

james23_uk wrote: »

Thanks - good info. In your experience do creditors/IPs tend to push for bankruptcy? I would have thought they would.

Only if they have something to gain. That is not very often.

Once you realise that going for someone's bankruptcy will cost a creditor up to £1,700 in up front costs without any guarantee of getting that back, let alone the original debt, then they are often not so keen.;)

Even if you were made bankrupt, then an individual creditor would only receive anything back if any money was realised from the bankrupts estate. The substantial fee of the bankruptcy would be paid first before any creditors get a sniff at any money.

So unless the potential bankruptcy has sizeable assets then a creditor isn't going to seriously go for bankruptcy.

But they do like to use it as a threat to hold over someone's head, because they know the idea scares the **** out of most people.

kevsadie82

how about if you think you were mis-sold your iva can you get out of it that way?

oscar52

Sorry for thread jumping, but i am interested in Fermi's last post.

I know somone currently in an IVA, and about to enter year 4. Just now, they have had a reduction in income (permanent) after turning 60 and losing certain benefits (income support i think). The IVA is £400 a month. When they called the IP to advise this, and the fact they may not have the money, they were threatened with bankruptcy if payments were missed.

They have no assets - no house, savings etc, but are worried all and sundry will come and snatch just about everything they can. I have tried telling them otherwise.

Question is, what is the best line of attack here? £400 is no longer feasible, but IP wont budge.

fermi

oscar52 wrote: »

Question is, what is the best line of attack here? £400 is no longer feasible, but IP wont budge.

As stated, they need to have a very good look at the IVA agreement to see what the consequences of failure might be.

Might be best for them to have a chat with the organisations in my signature.;)

oscar52

fermi wrote: »

As stated, they need to have a very good look at the IVA agreement to see what the consequences of failure might be.

Might be best for them to have a chat with the organisations in my signature.;)

that was quick!!!

Ty fermi, will pass it on.

Im assuming that an IVA payment can be recalculated?

fermi

oscar52 wrote: »

Im assuming that an IVA payment can be recalculated?

Subject to agreement by the creditors, yes.

oscar52

fermi wrote: »

Only if they have something to gain. That is not very often.

Once you realise that going for someone's bankruptcy will cost a creditor up to £1,700 in up front costs without any guarantee of getting that back....

Thread jumping again

Fermi (or anyone else in the know)

The costs stated above, could you elaborate a little - is that per creditor - so so if 5 creditors, it could cost £8,500 or is £1700 total cost between creditors?

Reason for asking is will probably be speaking to IVA company once the person i mentioned above has confirmation of their final income. My reason for the question above is that although I orginallysaid the IP wouldnt budge on the amount, I think (just my opinion) this may be as they dont want to take a reduced fee each month. If the above figures are correct, then with some creditors (£5/600) it isnt worth their while. I think the biggest one was £8K and thats been paid for three years (still being paid now despite drop in income, but only can do so for a month or two at most.

oscar52

bumping up - not desperate, but could do with the answer