Final settlement and IVA provider issues

maximus12 · 17 January 2018 at 3:40PM

Has anyone ever finalised an IVA without going through their IVA provider or must you go through them?
I have just spoke to my provider (payplan) and it seems so completed to submit a final settlement.
They need the following (is this normal?)
House valuation
Mortgage redemption
current income
income and expenditure
letter from parents (who are giving us the money for a settlement only)

Also apparently the minimum timescale for creditor meeting is 3 months?

They also state that the creditors may push us to bankruptcy instead of settling?
I thought this would be a way out of all this but I am beginning to think it makes matters more complcated

Any help would be appreciated
Thanks

National_Debtline · 18 January 2018 at 3:23PM

Hi maximus12,

If you have been in an IVA to pay monthly and would now like to amend that to a lump sum IVA, the IVA company will need to put the new proposal to the creditors. If you have not maintained the monthly payments under the IVA then it could fail, and without an agreed alternative arrangement there is a risk of bankruptcy. You could let the IVA fail, and then propose full and final offers to the creditors yourself, but you need to carefully consider the consequences of letting an IVA fail.

How likely it is for a creditor or the IVA company to apply for your bankruptcy will normally depend on your assets. For example, if you have no property, car, savings etc, bankruptcy is less likely as the creditors/ IVA company are unlikely to get there money back. However, this is not a guarantee.

If you have not been in a monthly IVA before this, and have only approached Payplan to do a lump sum IVA you may be to cancel their involvement if there has not yet been a creditors meeting and you would like to approach the debts yourself.

Laura
@natdebtline

maximus12 · 18 January 2018 at 7:42PM

National_Debtline wrote: »

Hi maximus12,

If you have been in an IVA to pay monthly and would now like to amend that to a lump sum IVA, the IVA company will need to put the new proposal to the creditors. If you have not maintained the monthly payments under the IVA then it could fail, and without an agreed alternative arrangement there is a risk of bankruptcy. You could let the IVA fail, and then propose full and final offers to the creditors yourself, but you need to carefully consider the consequences of letting an IVA fail.

How likely it is for a creditor or the IVA company to apply for your bankruptcy will normally depend on your assets. For example, if you have no property, car, savings etc, bankruptcy is less likely as the creditors/ IVA company are unlikely to get there money back. However, this is not a guarantee.

If you have not been in a monthly IVA before this, and have only approached Payplan to do a lump sum IVA you may be to cancel their involvement if there has not yet been a creditors meeting and you would like to approach the debts yourself.

Laura
@natdebtline

Hello Laura,
Thank you for your reply.
We are in a pay monthly and are up to date with payments. We have 34 months remaining in the IVA and I have offered a lump sum of just over half.
It just seems everytime I ask payplan anything they come up with more things we need to do and a longer timescale. They only asked for a letter at first which I did and now want all this other information. I just find them totally unhelpful and just would love the IVA to be gone, so hoping my families offer will finalise it all.
Is it normal for the creditors to ask for all this information? Thanks

PrettyKittyKat · 18 January 2018 at 7:58PM

yes it is very normal. Payplan are actually helping you put an accurate offer to the creditors.

Think about it...

You are up to date, the I&E shows you cna afford the payments.... why would they accept a lump sum of just over half of what is left when they could allow the IVA to continue to it's original term to get almost twice as much plus the opportunity of equity release/additional money.

Providing the house info is what you would have to do in month 54. If it shows no or little equity then the creditors don't have any concern over accepting the f&f and forgoing possible funds from this later down the line.

If the I&E is up to date, ideally showing a reduced disposable income, it will encourage them to accept the f&f as the ongoing affordability of the IVA is in jeopardy.

It has to be evidenced that the money is a gift to you to settle the IVA and not money that should be due in as a windfall anyway. Also payplan should have asked for evidence of where it is coming from for money laundering. So I would recommend including a copy of your parents bank statement (you can black out all the personal info, but needs to show account number, name, sort code, and available balance ) and confirmation it will be paid directly from this account to paypal if the offer is accepted.

Creditors do not have to accept f&f's. You have to make it as attractive as possible for them to accept it. Paypal are right to ask for all this information and the IVA company I used to work for (different one) did also.

sourcrates · 19 January 2018 at 1:35PM

Usually in order for your creditors to accept a lower payout than what was originally agreed, you would need a very good reason why they should accept the offer.

Say for example, you were been made redundant, and were unsure of your future work prospects, or you became ill, and couldn't work, or something along those lines.

Just because your family has offered this money, does not obligate the creditors to accept it, in fact, its highly likely, that unless you have an extremely good, sound, financial reason why they should accept the full and final offer, and not continue with monthly payments, the offer will be rejected outright.

I fear you may be mis-understanding the process you have signed up for here, i`m sorry to say that you may be wasting your time

maximus12 · 19 January 2018 at 9:51PM

sourcrates wrote: »

Usually in order for your creditors to accept a lower payout than what was originally agreed, you would need a very good reason why they should accept the offer.

Say for example, you were been made redundant, and were unsure of your future work prospects, or you became ill, and couldn't work, or something along those lines.

Just because your family has offered this money, does not obligate the creditors to accept it, in fact, its highly likely, that unless you have an extremely good, sound, financial reason why they should accept the full and final offer, and not continue with monthly payments, the offer will be rejected outright.

I fear you may be mis-understanding the process you have signed up for here, i`m sorry to say that you may be wasting your time

Hello,

I do understand what I have signed for. My partner had a bad accident at work last year and more operations are inevitable which he wont get paid for. Our payments are up to date due to having lots of help to keep them up to date which help has now run out so to speak.
The IVA provider are aware of all this and its all been included in the letter.
I am really grateful of the information just wanted to check everything as it seems like a lot is needed if they say no.
Thank you

sourcrates · 19 January 2018 at 11:17PM

maximus12 wrote: »

Hello,

I do understand what I have signed for. My partner had a bad accident at work last year and more operations are inevitable which he wont get paid for. Our payments are up to date due to having lots of help to keep them up to date which help has now run out so to speak.
The IVA provider are aware of all this and its all been included in the letter.
I am really grateful of the information just wanted to check everything as it seems like a lot is needed if they say no.
Thank you

Ah! Ok, then use that as leverage in your dealings with them.

Good luck.

Final settlement and IVA provider issues

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