An Individual Voluntary Agreement (IVA) is a formal, legal contract for a set period, usually five or six years.
To finish your IVA sooner and have the remainder of your debts written off, you need to talk to your IVA firm, say how much you are offering and where the money is coming from. Your creditors will need to approve this offer.
How much you should offer as a Full and Final (F&F) settlement depends on your situation and why you want to end your IVA early.
Contents
How do you settle an IVA early
This is how it works:
- you tell your IVA firm what you want to offer;
- your IVA firm puts your proposal to your creditors as a “variation” to your existing agreement, some firms charge for doing this;
- the same offer is made to all your creditors and they vote whether to accept it.
These offers take time – often a couple of months.
5 situations NOT to make an offer
You may hate the IVA, wish you had never started it, be desperate for it to end… but there are some situations in which an early settlement is not your best option.
When you are in the last year
The closer you are to the end of the IVA, the less point there is in settling it early. It can be a lot less stressful to simply sit back and make those last 7 payments.
When you mainly want the IVA off your credit record
This doesn’t happen after an early settlement – your credit score will not improve. The IVA marker remains on your credit record for 6 years from the start. Settling it early will not make it easier to get a new tenancy or a mortgage in most cases.
When the IVA payments are too high to be affordable
Here you should be to get the payments reduced – see Help with IVAs if you can’t pay because of the cost of living. So talk to your IVA firm. Do this first – then IVA may be manageable and if you still want to settle it, it may cost less.
When you can’t afford to make any IVA payments
There are two other options that could be better for you here.
The first is to ask the IVA firm to propose to your creditors that your IVA should be completed now, not failed, “on the basis of the funds paid to date”. See this which looks at when this is a reasonable thing to ask for.
The second is to let the IVA fail and opt for another form of insolvency – a Debt Relief Order or bankruptcy. Here your debts are cleared and the money you are being offered by a relative could help you have an easier next few years. if you have other debts outside the IVA, this will also get those wiped as well.
When you have other debts outside the IVA
It may be that you are getting behind with the energy bills, rent or council tax because of the IVA payments. Here it would be better to get your IVA payments reduced and any money from a relative could be better used to clear these other important debts.
First look at what you are likely to pay at the current rate
You can’t try offering 40% and then increase it to 50% and then to 75%. Assume you can only make one offer, so get it right the first time.
The first thing is to work out how much you would pay into your IVA if you carry on making the monthly payments. So, how many months are left until your IVA finishes? If you have a house with equity, add on the 12 months that your IVA is likely to be extended for.
Then multiply your current IVA payments by that number of months.
For Example – say you are 28 months into a 5 year IVA, so there are 32 months remaining and you pay £200 a month. If you don’t have a house with more than 15% equity you will be paying in either 32 x £200 = £6,400. With equity in your house you can expect to be paying 44 x £200 = £8,800.
Then consider if you have a good reason to offer less than this
Case 1 – you are struggling with your IVA payments
In 2022 this will often be because energy bills, petrol and other prices have risen a lot. But it could be due to more individual factors such as illness, splitting up with your partner or reduced income.
Here your first thought should be to get your IVA payments reduced, or your IVA completed, see above. But if they won’t work. if your IVA is in danger of failing your creditors may be prepared to accept a lower offer to complete your IVA early.
In this case, you should stress to your IVA firm that if your settlement offer is not accepted, you are going to be unable to continue with the IVA. So your creditors have a choice between accepting your IVA settlement offer and the IVA failing.
The creditors will be interested in whether your problems could be temporary and if your IVA could realistically continue. Evidence of your circumstances may help get your offer accepted:
- a new Income & Expenditure form showing you have very little spare income because of increased bills and prices;
- a letter from your doctor or a hospital appointment letter;
- copy of recent payslips;
- a recent estate agent’s valuation showing there is little or no equity in your house can also clarify the position.
With this evidence, your creditors may agree to accept a lower full and final settlement than your remaining monthly payments.
What might be acceptable depends not just on how much there is still to pay into your IVA – the total amount of your debts is also relevant. If your IVA was only offering a low return to your creditors, then they may not agree to this being reduced much.
Case 2 – you just want the IVA ended
If you aren’t struggling, you probably have to offer close to the total of the remaining IVA payments.
Here the reasons why you want to end the agreement early don’t really matter – you may want to emigrate, retrain for a different career, move in with a new partner or just be sick of the whole thing and want to start with a clean slate.
But from your creditors’ point of view this is all pretty irrelevant: they simply have to choose between taking your offer of £x,000 now or you carrying on with the monthly payments.
So on the example given above, they would be unlikely to accept £3,000, may be prepared to take £5,000 immediately and would be very likely to accept £6,000. If there was some equity in your house, then you would probably have to offer more to get it accepted.
Case 3 – you have a windfall payment you can use
Lump sums and an inheritance need to be discussed with your IVA firm. There is normally a clause in your IVA which means that windfalls over £500 have to be paid into your IVA.
Here you don’t have a choice. This isn’t an early settlement offer because the money has to go into your IVA:
- when the amount that will be paid into your IVA is more than the total of the debts in the IVA plus the IVA fees plus statutory interest on the debts, your IVA will be completed early.
- if it isn’t large enough for that, your creditors will expect you to carry on with the normal monthly payments.
More unusually, sometimes a windfall payment doesn’t have to be paid into your IVA – this could, for example, be compensation for a personal injury. Here it is your choice what you want to do with it, so you can make an offer to settle the IVA early if you want. Or you could just let your IVA continue and keep the money.
Or it could be your partner who is getting the lump sum – that doesn’t have to go into your IVA. You could just carry on making the normal payments or you could offer to settle the IVA early, probably having to pay close to the remaining monthly payments as in Case 2.
Case 4 – your IVA firm suggests you take a loan
If you are more than halfway through, your IVA firm may say you may be able to get an “early exit loan”. You need to think carefully about this offer, as the loan may be expensive (eg about 30% interest) and it prolongs the time you are in debt.
See IVA early exit loans for details, including the alternative, cheaper ways of improving your credit record after an IVA.
IVA settlements are unpredictable
It’s impossible to say for certain whether your creditors will accept an offer. Someone with a lot of experience will sometimes be suprised when a good offer is refused. Other times surprisingly low offers are agreed.
If you don’t mind putting details of your situation on the internet, then the IVA forum may help. You can post anonymously and get replies from people who work for IVA firms or who have had an IVA.
Where is the money coming from?
Your IVA firm will want to see evidence about the source of the money you are putting forward. It won’t matter if this is coming from a relative or a friend. This could include evidence about the identity of the donor, perhaps a copy of their passport or driving licence, and proof that they have the money, such as a copy of a bank statement.
If you were just given £5,000 by your dad as a generous Christmas present, then your IVA firm will want you to pay this into your IVA and still carry on with the normal monthly payments. So it’s important to say you will only get this lump sum when your proposal to settle the IVA early is accepted.
Be careful! And check the details!
There are two situations where you have to be very careful and get the settlement agreed first:
- you must NOT take any money out of your pension until you have confirmation that your creditors have accepted your offer. If you take it out before this, it could be claimed as a windfall payment and you would still have to carry on with the IVA! See IVAs and Pensions for more information.
- if the money is going to come from selling your house, make sure you read Sell my house to end my IVA early. You need to get the settlement amount agreed BEFORE you start to sell your house.
If your IVA firm agrees to put forward your proposal, you should make sure you know the exact details of what is being proposed.
“My IVA firm won’t put my F&F offer to my creditors”
If you only have a few months to go, it’s not arguing about this. It usually takes 2-3 months to get it all organised and approved by your creditors. If you are near the end, your IVA firm is just saying it’s simpler to make the remaining payments.
Make sure you have set out in writing exactly what you are proposing and why. If your IVA firm says it can’t be done or the offer isn’t enough, ask them to explain why. Insist on having this in writing.
If you think your offer is a sensible one and your firm is being unreasonable, put in a formal complaint.
What if the offer is refused?
If your creditors reject the proposal, you have to carry on with the normal monthly payments.
You could talk to your IVA firm about whether a higher IVA settlement offer might be acceptable now. Or if you could make the same offer in another six months or a year, which will give your creditors more money as they will have had the additional payments.
If you simply can’t carry on with the payments, then it may be that your IVA has to fail. See Your option when an IVA fails for what you can do then.
Should I sell my house to end my IVA?
Lower IVA payments because of inflation
More than a third of IVAs fail
Gman says
Hi, I’m 41 months into a 6 year iva so basically 31 months to go.
My original debt was just over 21000 and I’m paying back 250p/m so 18000 total repayment. I think my outstanding balance is around 8000.
I’m married but my wife is not named on my iva and I’m not named on mortgage or deeds of the house.
We desperately need work done to house due to general wear and tear ie can’t be claimed off insurance. My wife wants to take a loan out to cover the cost and has offered to add extra to the loan to pay off the outstanding balance of my iva so around 8000.
Will the iva/creditors accept a gift payment from my wife if she is getting it in form of a loan.
Further to this I’ve had a lot of overtime recently as someone from work had massive heart attack and hasn’t yet returned, this came in handy as it also coincided with my wife’s maternity leave and the extra expense of a child. Will the iva expect me to pay back more because of this.
We’ve also had to but a new car which again is in the wife’s name as I obviously can’t get credit as our old car was much too small for a baby seat never mind prams etc.
I would love to be out of this iva too as I don’t think it was what I actually needed as I was panicing as I thought I was about to be paid off 3 months after getting married but was luckily saved but did take a big hit on my earnings.
Sara (Debt Camel) says
“Will the iva/creditors accept a gift payment from my wife if she is getting it in form of a loan.” yes I would expect so.
BUT doing this means you are now paying interest on the 8k IVA payments and, worse, it is secured on the house. Is this really sensible? At the moment if you lost your job and can’t get another one, you could ask for your IVA to be closed on the basis of what you have paid to date. Extend the mortgage and you can’t do anything.
I get that you really want to be out of the IVA but your credit record is screwed for 6 years. Even if you do settle the IVA early your credit score will not improve.
“Will the iva expect me to pay back more because of this.” you need to talk to your IVA firm about this because you will have extra expenses as well, and also had to pay a higher proportion of the household income as your wife’s income is lower. As a result it may be that you need to ask for lower IVA payments!
Gman says
Yeah it’s a rock and a hard place sort of situation.
We aren’t really worried about my credit rating but really need the work done on kitchen and bathroom but aren’t in a position to do the work currently and waiting another 2.5 years unit the iva is up isnt great.
the money freed up by finishing the iva early would cover the cost of the loan but the 7 years a paying it off is another dilemma….maybe leave it until we have no choice but to do the work which may happen sooner rather than later in the bathroom at least
Magdalena says
Hi I am in 48 month in my IVA I had paid already £15000 my deb was £9100, but Becouse my income was changing my Iva pay was intended from year to year I am wondering do I have to still pay another year £310a month . I two kids one of them is disabled and I would preferred to put those money for his therapies rather paying almoust duble for the debs I had.
Sara (Debt Camel) says
The £15,000 already paid – was this from your monthly payments? Or does it include PPI refunds?
Helen says
Hi I currently have an IVA and have made 28 payments of the 71 required. I would like to finish the IVA with a one of payment (money given from my parents to pay IVA if agreed). Total remaining is 5500 and I plan to offer this. I do not own my own home, my husband does however I was advised that he would have to agree to a re-mortgage, and he was in his rights to say no. Do you think this would be accepted? I have spoken to an advisor who didn’t respond positively to this question stating that they may not agree to anything less than the full amount and possibly would not agree to this either???
Sara (Debt Camel) says
As your IVA appears to be 6 years, it sounds as though an extra year was originally added because you would not be in a position to release any equity from your husband’s house.
Can I ask if you are struggling with the IVA payments? Are your circumstances likely to change?
Helen says
I am managing payments with help from parents. my husband has fibromyalgia so there is a strong possibility that in the future he may have to reduce his hours or give up work completely. In light of this I feel paying of early again with the help of my parents would be beneficial.
Sara (Debt Camel) says
In that case you need to explain both these facts to your IVA company. Point out that if the offer is refused, you may have to ask for your payments to be reduced.
helen says
Thank you for your help Sara, I will keep you updated.
Ian says
Hi. I offered what was ‘left’ on my IVA and that was accepted. Let me tell you, the relief you get when that payment is made and the completion certificate hits your doormat is unbelievable. Sometimes just to get rid is enough of a reason to do it. I wish you and your husband well.
Helen says
Thank you Ian fingers crossed it will be accepted and we can get on with our lives debt free!
Helen says
Just an update. still waiting after 4 weeks. contacted this morning and they have advised it could take up to 6 weeks to be processed. keeping everything crossed.
Mint says
Was it accepted?
Layla says
If you received a pay rise and keep getting promoted meaning wages go up and up which means that over the 5 years term, the amount you are paying in will cover more than the total IVA plus creditors fees (meaning your payment are so much higher than when IVA was agreed if you kept paying for the full five years you would have overpaid the agreed amount) is this right? Or would the IP tell you once you have paid in full (say three years in) and offer the completion certificate?
Sara (Debt Camel) says
If you are paying a lot more and think you will have paid more than all the debts that went into your IVA plus the IVA fees (which will be several thousand pounds or possibly more) then I suggest you should be asking your IVA firm at each annual review if you are going to complete the IVA during the next year.
Juggy S says
Hi,
I am on an IVA and my partner is now on mat leave without payment, is there a possibility that I can take a payment break for 9 months or even reduce my payments to half until my wife returns to work?
Thanks
Sara (Debt Camel) says
How far into your IVA are you? Have you had a break before?
Also have you done the arithmetic and looked at what your situation will be when your partner goes back to work if they then have extra childcare costs?
Kelvin says
I have an IVA which ends (5 years) in May 2020, I pay £70 a month but because I have a house attached to the IVA (ex wife now lives in it), I’m totally confused on what to do next? I want to end the IVA but not sure which route to take. I don’t really want to have the 12 months extension until May 2021, no equity will be able to be released as my ex wife won’t be able to re-mortgage.
Advice needed please.
Kelvin
Sara (Debt Camel) says
do you want to try to make an offer to settle the IVA now? Or are you just keen that it will end in May next year?
The house is included in your IVA – so originally you were expecting to have to release equity and your ex signed a RX1 form?
jeffery says
i recently enquired about an i.v.a and was given a payment plan of £100.00 a month for 5years. since then a relative has aggreed to help me.is it possible to offer a one off payment of £6000.00. which is 60 payments of £100.00.
Sara (Debt Camel) says
Has your IVA actually started?
jeffery says
my i v a has not yet started
Sara (Debt Camel) says
Then I suggest you talk to National Debtline on 0808 808 4000 about what all your options are – if you have only been talking to an IVA firm there may be better options that you should consider. It is not a good idea to start an IVA with the hope you can very soon settle it – even if this was possible, the insolvency marker would remain on your credit record for 6 years.
sabrina gower says
i have been in contact with my iva and they have given me an offer that the creditors are likely to accept my partner is willing to pull the funds together because we currently looking to start a family very soon so iwill have to give up my job i own my own house what happens once the certificate is issued and i come into a windfall or sell my property ? d they still have the right to take that money or not.
Sara (Debt Camel) says
So this is what happens in order:
1. your creditors vote to approve offer – assuming it is agreed…
2. you pay the settlement amount
3. your IVA firm does a final review – assuming it doesn’t find anything wrong (eg you owe money for some overtime)…
4. your IVA firm pays your creditors, gives you the completion certificate, tells the Insolvency service and removes the restriction on your house at the land registry.
Your IVA has ended, you can inherit a million or sell the house and the IVA firm can’t claim any of it.
Seb says
Thank you so much for your reply.
Frances says
I am into my 6 year if IVA and want told I can get a secondary mortgage with the select partnership as I have equity in my property (although I was told this was not likely at first). They can release £11,373 but I do not want to get a further loan over 5 years at high interest! My debt was £37,000 and I have paid £34,000. I pay £523 a month and just want to be free of this (final payment is 24 July 2020). I may be able to release some pension. If so should I offer £11,373 as final payment and wait for confirmation before I try to release my pension? I keep getting conflicting answers from aperture?
Sara (Debt Camel) says
How much equity is there in your property and what is your property worth?
What interest rate are you being quoted for this secured loan? What would be the payments per month over the next 5 years?
How old are you? What are the rest of your finances like?
You have paid 34k – is that the total of your payments or does it also include any PPI that has been reclaimed?
Victoria says
Hi I wonder if some one could help me or advise me on what I need to do.
So I have an iva and paid 1 years off I think i am goin to come into some windfall money. Do I speak with my IVA company and ask if I van pay the full lot off then am debt free. I know this stays on your credit file for 6 years I think it is but would looking to get a mortage in the furniture.
Thanks any advice will be appreciated
Vicky
Sara (Debt Camel) says
Do I speak with my IVA company and ask if I can pay the full lot off then am debt free.
yes, but “the full lot” here means the whole amount of your debts plus the IVA firm’s fees plus, possibly, 8% extra interest on the debts. It doesn’t mean the total of the rest of your IVA payments.
You will find it impossible to get a mortgage at a reasonable rate of interest while the IVA remains on your credit record, even when it is ettled.
“I think I am going to come in” … how definite is this and how far in the future?
n s says
Hi, Looking for some advice. I am being made redundant and a friend has offered to do a full and final settlement on my IVA for me. I have paid in exactly half (9k) so another 9k currently outstanding. My IVA lady said I do not have to offer the full remaining amount of the IVA. How do I know what is an appropriate amount to offer and how likely is this to be accepted? My mental health has taken a real battering and the last time I was like this it resulted in an payment break (I should really have gone bankrupt then as I did not work for over a year) my friend does not want to see me in this mental state again. Any advice welcome thank you.
Sara (Debt Camel) says
How easy will it be to find a new job? How many years has your IVA been running so far? do you have a house with equity?
n s says
Hi, I am half way though payments wise as I had a few months of break due to mental health issues and not being able to work.
It was in from Jan 2016 that IVA started but not due to end until 2022 due to payment breaks etc. I can’t take the meds as they affect me too much which makes things worse. I have been in the past etc.
No house and my mental health is terrible again I know that I am in no place to contemplate looking for a new role :(
Ozias D says
This information is really helpful. Thank you Sara.
I am a third party considering to settle my friend’s IVA and will be using my own money including overdraft. Will these funds be considered by creditors?
Sara (Debt Camel) says
Why would you do this?
If you have loads of spare cash, then helping put a relative or a friend is a generous gesture. But you should always leave yourself PLENTY of money spare after doing this. that means not being in your ove4rdraft at all and having a decent size emergency fund left after making this settlement.
The debts in your friend’s IVA have all interest frozen and creditors cannot take action over them. To exchange that for you being in debt and paying c 40% on part of it is very foolish.
Christina says
Good morning,
I have recently been offered an early settlement loan via my IVA company. I have 15mths remaining on my IVA with monthly payments of £218, the loan offer would be 18mths at £200.80 but at an interest rate of 39.9%apr. I’d love to be out of it as I have a little one due in July however have learnt my lesson with borrowing and high interest rates. Would this offer be advisable?
Kindest Regards
Sara (Debt Camel) says
Who is your IVA firm? I thought these loans had stopped…
I am assuming here that you don’t have a house with equity.
So your IVA will have finished if you pay 15 lots of 218 = £3270
Or you can settle it now and owe 18 x 200 = £3600.
That doesn’t sound like a good deal.
What is worse, is if you have problems with the IVA payments, eg if your income drops when you are on maternity leave, then you can ask for your monthly payments to be reduced, to have a payment break or even for your IVA to be ended early.
But if you go for this expensive settlement loan and you have problems with the payments, your credit record will be affected for the next 6 years, just at the point you were hoping to get back to a clean credit record.
With this loan, you are taking on all the risk and it is even going to cost you more. Continuing with your IVA sounds much lower risk.
PS best wishes for July!
Christina says
Thank you so much and I fully agree, hence my concern.
Take care,
Christina
Sarah says
Hello
I wonder if you could help please my IVA with creditfix is due to finish in August 2020 however i asked them for a settlement figure back in January of this year and they never bothered to respond to me
Do I stop paying when my final payment goes out on the 5th August what do i do please as they are a complete nightmare to deal with
Many Thanka
Sara (Debt Camel) says
This other article looks at what happens at the end of an IVA: https://debtcamel.co.uk/end-of-iva/
Sue says
Hi
My daughter as an IVA she is about half way through it, my husband and I said we would make a final offer to settle this debt £8000 this was about 10 weeks ago haven’t heard anything from step change. However she as since been made redundant can she continue with the offer we made or will she have to give them her redundancy money, or can she cancel her IVA and make an offer to her creditors herself.
Thankyou
Sara (Debt Camel) says
Can you give some more details?
How much is she paying a month? Is she buying or renting?
Do you know what her redundancy payment is likely to be and can you guess at how easy it will be for her to find another job?
Is she buying or renting?
Emma says
Hi I am in my 4th year of paying into my IVA which ends in November 2021. I pay £102 per month with 16 payments left equally £1632 and my father has offered to settle it for me due to struggling financially. which would be a reasonable offer to put forward which is likely to be accepted? he was considering £800?
Sara (Debt Camel) says
are you renting or do you have a house with equity?
are your current problems related to Coronavirus? If not has your income dropped or your expenses gone up for some other reason?
Emma says
I am currently renting i have been for the full term of my IVA
i have struggled for years paying it and gain assistance from my father which has all been explained to my IVA company. i had a baby boy nearly 3 years ago and whilst on maternity leave i explained i was struggling being a single parent and they offered no assistance except to drop my payments by £20 a month which would also extend my term by another 12 months which i declined.
I carried on paying the monthly payments whilst on maternity leave seeking help from my father. The IVA agreed i was seen to be scrapping the barrel. i have a car on finance which ends in august 2021 and part of the agreement was to pay the last 3 months car payments as well as the IVA payments all to them which i agreed but now the ULTEZ charge is coming into place in October 2021 i need to update my car as well which i cant afford too so i just want to get it all wrapped up so i can try to save what would of been my IVA money to get a car they meets the congestion charge zone so i can get to work everyday without being charged
Sara (Debt Camel) says
So coronavirus hasn’t affected you?
Emma says
It hasnt at the moment although i could be getting furloughed.
Sara (Debt Camel) says
Well that is tricky. It might be better to wait until you are furloughed then make the settlement offer.
It’s very hard to say what would be accepted. the more financial trouble you are in, the better the case for an offer being accepted but there is a big random element about what happens in practice.
Emma says
They have just emailed me a figure of £2559 would I be able to get this figure down
Sara (Debt Camel) says
Did you ask them for an amount to settle your IVA?
Emma says
I did yes I ask what it would be to settle after struggling and that is what they came back with. I said nothing more nor did I put forward a figure
Sara (Debt Camel) says
ok, I suggest you talk to National Debtline on 0808 808 4000. Explain your situation and say you would like to draw-up an income & expenditure sheet to send to your IVA firm to support your statement that you cannot carry on with the IVA and that your father is prepared to offer £800 to settle it.
Ash says
Hi, I’m into my 50th month on my IVA it has been extended to 73 month due to a large payment break in year 2/3.
I have taken out new finance back in Feb, as my old car died and would of cost 1000s to put right. I didn’t get permission from my IVA company as I thought they might just say no. Obviously I have told them retrospectively on my annual review, but they are dragging their heels and I’m now worried all my hard work is going to be for nothing and it might fail. I need a reliable car for work and to see my kids etc. I have been paying £79/month and can still afford to keep up 79/month even though the finance is 278/month, in reality this is because my partner (who’s not on the IVA) will be taking a larger share of the household bills and I have adjusted this on my annual review to reflect and explained in writing.
It is stressing me out and it’s the not knowing that’s killing me the most. I have forwarded all the info they’ve asked for and been told it’s being reviewed by the relevant department, can’t seem to get a definitive answer on a timescale or anything. I can’t be the first person to of found themselves in this sort of position… Do you know what are the possible outcomes and the likelihood of each?..
If there is a chance it’s going to fail I would rather offer them an F&F settlement as currently that would only be £1817 for 100% (and more like 1600 by the time they get their bottoms in gear!)
Thanks,
Asher
Sara (Debt Camel) says
These situations are all very individual. I can’t guess what your IVA firm is likely to say. If they think there is something seriosuly wrong then offering a F&F isn’t likely to get round that. Where would the money for the f&F come from?
Ash says
Hi Sara,
I haven’t worked that out yet, dont worry I don’t have it tucked under the mattress. I was only really thinking if it went sour I was thinking it might help if it came to it, I really don’t want it to fail so I would find the money whether it comes from my partner, family or a settlement loan. I’ve spoken briefly to a specialist loan company who work on the model of offering 85% to the creditors to take now so the amount I’d pay on the loan monthly for 2 years is barely any different, the bonus is I’d be free early, and my rating might start improving slightly faster.
Sara (Debt Camel) says
A settlement offer from your parter or family may be accepted. From a specialist loan company – not many IVA firms will do that. And generally they are a Bad Idea. It transfers all the risk of the IVA failing to you, instead of getting a clean start from your debts you now have another loan that you may have difficulty repaying, prolonging your credit record woes for another 6 years.
“my rating might start improving slightly faster.”
no it won’t. Ending an IVA early does not remove the IVA or the defaults on the debt in the IVA from your credit record early. The new loan does not help your credit score while you have all those massive problems on it.
This in’t just me saying this. This is what the Insolvency Service says about them in https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/743400/Monitoring_and_Regulation_of_IPs_Report__final_.pdf :
“The loans… ultimately cost the debtor substantially more… are sold on the basis they will help the debtor in the long term, by improving their credit rating. There does not appear to be any evidence that this is actually the case… By concluding the IVAs early the IPs concerned will also benefit by not having the ongoing cost of managing the IVA so there may well be a conflict of interest.”
Daniel says
Hi There,
I Am currently a year into my IVA, I was paying £100 a month for five years however it has changed now to £92.50 every four weeks to coincide with my paydays. I am looking to settle early as I have been offered £5000 from a friend of mine as a gift to settle my IVA early. In your honest opinion do you think £5000 is ok would they accept that figure?
Sara (Debt Camel) says
Are you struggling to pay that much or would you just like it all over?
Daniel Norman says
Would just like it all over to be honest with you. :)
Sara (Debt Camel) says
ok, so there is no reason to offer a lot less than your creditors will get if the IVA completes.
You do know that if your IVA finishes early your credit rating will not improve and it will still be wrecked for the rest of the 6 years and you find it VERY hard to get a mortgage, or another tenancy unless you have a guarantor?
Daniel Norman says
Yeah totally understand that, was hoping around £5k would be around the amount of my monthly payments just got rid of the instalments and it’s completed
Sara (Debt Camel) says
It’s definitely worth offering that if your friend can afford it. But not, I would say, if this is a loan that you will have to repay.
mohammad says
Hello
I am on 6 years IVA plan. Paying 100-pound month. Fours years passed. Now due to C19 no work left in the market as I drive minicabs in London as a taxi driver. Now 24 months still to go means I have to pay 2400 pounds in total which is 100 pounds a month. How much should I offer them to get my IVA clear early? Someone says 80% should be offered of leftovers and will be accepted. Should I offer 1800 pounds to clear my IVA in one lump sum as my friend ready to gift me this amount to iva my debt? IVA team not saying anything for sure whether it will be accepted or no. They saying we will place the offer to creditors and will take around 6 to 8 weeks for a reply from creditors. If accepted by them than its ok or I had to continue with my 100 pounds payment a month as normal. Need suggestion lower offer like 1800 pound sounds good or I should offer full 2400 pound which is leftover and get out this in one go and save that 6 to 8 weeks waiting for a reply from creditors.
Sara (Debt Camel) says
6 year IVA plan – do you have a house with equity?
stacey says
Hi,
Myself and my husband both have IVAs we are 1 year in of the 5 years plus the 1 year extension because of our house. I spoke to our IVA company the other day and was advised the total settlement for both IVA’s would be £10,890. My husband is being made redundant because of Covid 19. He has however got another job but its self employed and if there is no work there is no Money. I currently work part time as I’m a student however have been furloughed. We are considering attempting to settle early as we have no idea what our financial future looks like. Any ideas what a reasonable offer would be in this case?
Sara (Debt Camel) says
Is he getting any redundancy pay?
Where would you get any money to settle the IVAs from?
how large were each of your debts in the IVA?
S Robinson says
Hi, can I ask how long it took to get it settled and who your IVA company was? Thanks
Sara (Debt Camel) says
Not sure who you are asking?
Nikki Stones says
Hi all,
Just wanted to say that I offered my IVA company 7800 on 9800 outstanding and it was accepted. I think that they probably would have taken a little less but not a game I wanted to play, too stressful!! So now it is all complete. I think that many people will be defaulting due to financial issues from this time so maybe they were pleased to have something . Good luck x
Sarah says
Hi, I’m currently in month 12 of my IVA but have lost my job. I have £500 in an emergency fund which I have had saved and kept aside for about 3 years now. I usually pay £90 to the IVA each month but with no job this is going to be difficult especially with it being so difficult to find a job due to covid. The remaining balance I “owe” with the rest of my IVA payments is about £4000. What is the likelihood of my creditors accepting the £500 as complete settlement?
Thanks
Sara (Debt Camel) says
Are you buying or renting? How large were the debts going into your IVA?
Sarah says
the total debt was around £17k and i’ve paid £1080 in payments into the iva already. i’m currently renting.
Sara (Debt Camel) says
I think the chance of them accepting £500 is extremely low – creditors would actually get almost nothing of it as it would mostly go in fees to the IVA firm.
Besides, you probably need that £500 to live on…
One option for you is to ask your IVA firm for a 6 month break from payments to enable you to find a new job. At the end of that if you still haven’t found work you could ask for longer. But atll this time is just added onto the end of your IVA pushing out the time it is finally gone.
If you think you are either not going to be able to find work OR it is likely to pay less than your previous job or be insecure work, then you have another option which is to choose to let your IVA fail and then go for a Debt Relief Order to clear your debts. See https://debtcamel.co.uk/end-iva-change-to-dro/ for more about this. If you think this could work for you you MUST talk to a debt adviser (NOT your IVA firm unless that firm is StepChange who also do a lot of DROs?) now about your situation and whether you will qualify for a DRO.
This does involve predicting the future which may look very uncertain. All I can say is it is better to think and make some guesses than to plod on in a long payment break from your IVA only to be back looking at a a DRO in 6 or 9 months time.
Sue says
Hi,
I have an IVA payments of which are affordable . I am told I can earn up to 200.00 extra a month before any extra has to go in the IVA pot. I am in a long term relationship in which my partner contributes towards the rent. However I feel my relationship may not last . Can I earn extra and save it to cover loss of his contribution I am also helping my Daughter with private medical bills.
Sara (Debt Camel) says
How large are the debts that went into your IVA?
How large is your current IVA payment? How long until your IVA ends?
How much worse off will you be if your partner moves out?
You are renting, no mortgage?
Nicola says
Hi I am currently just at the end of my first year paying my iva. I am recently separated from my husband who is a home owner I am not named on the mortgage. After seeking legal advice I may be entitled to 50% of the house if sold. How will this affect my iva, will I be expected to pay the full amount back with any profits I do receive? Many thanks!
Sara (Debt Camel) says
If the house is sold and half is sent to you, you would be expected to use it to clear all the debts in your IVA, possibly plus 8% a year extra interest on those debts, plus the IVA firms fees.
Jess says
We have 8 months left on our IVA, due to Covid19, we have both still been working and managed to save some money, I am wondering if it worth offering the £2,040 to finish my IVA and get it out of the way with, however, my concerns are that there was a variation to reduce payments last year and it was accepted as only half of the creditors want money, would this affect it even though all creditors asking for money would get 100%?
Sara (Debt Camel) says
If a variation was accepted last year, that applies to all creditors, even those that voted against or failed to vote.
How much do the 8 months remaining payments add up to?
Geoff says
Hi there,
I have paid 29 months of my IVA at £700 per month. I have 31 months left to pay (£21,000).
At the end of June I lost my job and have no savings and don’t own my own house.
If my family were prepared to gift me the money, what do you think would be an acceptable amount to offer for a full and final settlement and would it be accepted.
I was thinking around £8,400.
I have no idea in the current climate when I will get another job.
Thank you in advance
Sara (Debt Camel) says
I don’t know. It may be better to ask for a payment break then make this offer in 3 or 6 months if there is no sign of you getting a good job.
Marie says
Hello
I have been paying my IVA since August 2018 payments started at £140 a month and now £155 a month. It’s a 5 year IVA and I’m now being made redundant and was looking to make them an offer for the remaining approx 3 years so approximately £6000 and wondered if you think it will be accepted? I’m currently on furlough until my notice finishes September the 18th. I would be able to keep pretty much my redundancy if I don’t have a new job as it’s the six months wage pay to allow to look for new job but I don’t think I’ll find another job yet as my daughter is not back to school until September and I’d imagine pay will be lower on new job.
Sara (Debt Camel) says
Where would the money come from, a relative? Or would you be using your redundancy? In which case, what would you have to live on?
Marie says
Was thinking the redundancy as that would leave around £1.500 and I’d also have holiday days about 12 to be paid. Guess that would only be enough for two months. I doubt they would take less?
Sara (Debt Camel) says
I don’t know if they will accept the offer – they may prefer to wiat and see if your find a job, but it’s not a “silly” offer like £1000 of much larger redundancy money so if this is what you want it’s worth a try.
The alternative is to keep the 6 months of money and just carry on paying your IVA for that period while you look for a new job.
If the new job is paid a bit less, you can then ask for the IVA payments to be reduced. But if the new job is a lot less – or you can’t get a new job – you may not be able to pay anything. At that point you can ask for your IVA to be completed “on the basis of the fund s paid to date” – this would have to be approved by your creditor. They may agree given the circumstances or they may not – no-one really knows how this will go because there could be a lot people with IVAs in your position.
Marie says
Hello so today I received a letter informing me of £7.795 PPI claim so I know all this will go towards my IVA and wondered if that might accept a smaller amount of my redundancy money along with this PPI payment? Thanks Marie
Sara (Debt Camel) says
I doubt it. It is all a bit random as to what creditors will accept at the best of times, and coronavirus has added another large uncertain element. But as i said I don’t know if they will accept the offer you were originally proposing, the lower it is the less likely this is.
But if they say No and after 6 months you haven’t found a job, or not one that would pay enough for the IVA to proceed, at that point it may be a bit more likely your creditors will agree to close the IVA on the basis of the funds paid to date as they will be largere with this PPI payment.
Nikki Stones says
Hi, I would be careful with Redundancy as I was told by my IVA company that they could take all of it as it is classed as windfall and then they can offer you a payment break until you get a new job. Thank you
Sara (Debt Camel) says
That would be unusual. Most IVAs have specific rules around redundancy, see https://debtcamel.co.uk/iva-redundant/.
And now there are news rules because of Covid-19 – but they are rather vague, see https://debtcamel.co.uk/coronavirus-new-rules-ivas/
Nikki Stones says
Yes, I think that there are some that use the “vagueness” to their advantage. It makes sense to start afresh from redundancy imo and I hope that this is a successful outcome :) :)
Kayley J says
Hello I have been made redundant from my workplace and entered an IVA six weeks ago. I wish to settle my debt in full and pay my creditors however the IVA company has confirmed I must pay 100% of the debt.
My thoughts are if I rang round my individual creditors and offered them a settlement figure to close the accounts and settle then I am sure the payment option would be lower? Is there any flexibility on doing this if I have already signed a contract with the company it seems ridiculous if I am able to work these payments down in order to close any help will be much appreciated
Sara (Debt Camel) says
Sorry a lot of questions.
Was your IVA set up after you knew or suspected you would be made redundant?
Where is the money coming from for the settlement – redundancy pay?
Do you have a house with equity?
Had you already defaulted on your debts before your IVA started?
How easy will it be to find a new job?
Kayley says
suspected you would be made redundant? It is a voluntary severance pay and decided to go through with it
Where is the money coming from for the settlement – redundancy pay? Yes
Do you have a house with equity? No
Had you already defaulted on your debts before your IVA started? Yes
How easy will it be to find a new job? Very easy
Hope this helps thanks
Sara (Debt Camel) says
Did you discuss the possible redundancy with your IVA firm before the IVA was arranged? Did they ask you about your job?
How large is your redundancy payment? how large are the debts that went into your IVA? how liargdarr your monthly payments?
Andy says
Hi,
I was wondering if you could advise. I’m in an IVA with Payplan with 3 years and a few months remaining. My payments are just short of £100/mo and are completely up to date. I want to emigrate to be with my relatives in the US once CV19 is over.
I’m not really happy with them as a company. The IPs there seem to come and go. I’ve had at least 4 different ones since I started the process. Also, when I was off work for a few months last year they were totally unsympathetic and refused to offer a payment break or reduced payment to help with the bills or anything like that. I lost most of my work in March because of the lockdown but I’m still having to make full payments because they refused to help me again. At this point, I just want to get rid of them. How would I go about making an offer that will be accepted?
Thank you for your help.
Sara (Debt Camel) says
So your income is still down? Do you have a house with equity? Is there anyone in your family that can offer a settlement amount for your IVA?
Andy says
I’m working part time at the moment. I’m self-employed. When CV19 hit, I’d only been back at work fully for three months after my illness and I didn’t really have a chance to build up my business again. I live in rented accommodation and I don’t have anyone who can offer a settlement amount, but I am entitled to some money from the government self employment scheme in August. Could I use that along with some money I’ve saved up as part of an offer?
Sara (Debt Camel) says
And what are you going to live on? Pay the rent on? I suggest you back to your IVA firm and say you need a break from payments as your income has been hit by Coronavirus.
Issy says
Hi I’m 2 years into my IVa I’ve just been told I’m getting an affordability refund back worth 6500 , obviously had to tell my ip about this , been told I Carnt keep any of it , they did say the could make tge creditors an settlement offer which mite clear the Iva but only if they accept , I’m gutted I Carnt keep any as I’ve been on furlough for the last 4 months and have struggled paying all my bills , do you think the creditors would accept ?
Sara (Debt Camel) says
That is a large refund, what sort of debt was it from? is it a debt in your IVA?
Are you buying or renting? Will you soon be back to normal earnings?
Issy says
The refund was from amigo loans, no not on my Iva and I will be back to work normal hours soon
Sara (Debt Camel) says
The money is due to go into your IVA. You could ask for a break from your IVA payments for a couple of months to let you pay off some bills?
Maria says
I separated from my husband two years ago and due to leaving the home with absolutely nothing, I have had to fully furnish the new home for me and my son. He is 15 years old. Although I did have debt prior to leaving, I had to take out a 15,000 loan. I had a total debt of 27,000. I took out the IVA in Feb and have now made the decision to divorce my husband and request that he buys me out of the house (although my name is not on the mortgage). Although my husband has stated that he does not want to divorce, I am now inclined to believe that his reasons for this is for financial reasons. The solicitor has recommended that due to my son’s age, the financial issues need to be resolved now because I am likely to lose out if I wait any longer. My aim is to pay off the IVA early although I have only been contributing to this for 7 months. I am renting a property and would like to buy it when the landlady decides to sell. Can you explain what the process is please? I currently pay 238:00 a month for 5 years. I work full time and there is not a possibility of me losing my job. It is secure. Can you advise me please? Will my credit rating improve once the IVA is paid off?
Thanks
Sara (Debt Camel) says
Can you advise me please?
No, but I can ask some questions so you know what to think about and what to discuss first with your solicitor and IVA firm.
Is the house listed as an asset in your IVA?
Will my credit rating improve once the IVA is paid off?
No. You are stuck with a wrecked credit rating for 6 years from the date it started even if it is settled early.
Matty says
Hi
I’m looking for some help. I am 11 months into my IVA, I currently pay £100 a month with 49 months remaining to pay off a total of £6000.
I have been offered the £4900 remaining by a relative in order to pay off the IVA and end it early – however Creditfix, who this is through, have said the minimum amount they’d accept is £6500 and maximum £13500. Surely this isn’t right? Can I offer the remaining £4900 still to the creditors even if they’ve said £6500 is minimum? And if so, what are the chances of it being accepted? Thanks
Sara (Debt Camel) says
has your pay increased? are you buying or renting?
Matty says
My pay has increased by around £10,000 since I took the agreement out.
I pay rent to parents but i want to get a mortgage and move out, hence ending this earlier if possible.
Sara (Debt Camel) says
Then Creditfix will be expecting your monthly payments to go up, that may be why they are saying more than the minimum amount agreed at the start?
You can say you want the £4900 offer put to your creditors because it is all your relative can afford. In that case Creditfix may tell your creditors that it isn’t recommending this because … The creditors may decide to accept the offer as £4900 now may sound better than £6500 over the next few years, but they may decline. I can’t guess.
NB if your IVA is settled early, you still will find it difficult and expensive to get a mortgage for the next 5 years while the IVA is on your credit record.
Matty says
Thanks for the reply.
I notified them of my pay increase in February but they didn’t up the payments so I don’t think it’s that.
I’m aware it will still be difficult but better to end it now than in 4 years time.
Karlos says
Good afternoon,
I’m currently paying £170 per month for my IVA plan.
I would like to pay it off ASAP.
I still have 44 months to go.
What would be the best option to settle the IVA?
Best regards
Karlos
Sara (Debt Camel) says
Read the article above – are you in Case 1,2 or 3?
Karlosq says
Case 2.
My Partner would like to pay off the IVA on my behalf.
Karlos
Sara (Debt Camel) says
So the remaining months would be £7480 if your payments stayed the same.
Unless you can argue that you can no longer afford these payments, your partner will probably have to make an offer quite close to that. You could talk to your IP and see if they would be likely to recommend £6000, but they may say No.
Karlos says
My partner offered £7200.
My IP accepted the letter, passport photos and bank statement. So now they have to call the creditor meeting. I’m very positive with this matter. I’m almost sure they will accept it.
What do you think?
Sara (Debt Camel) says
Sounds good to me, but there is a random element here – fingers crossed for you !
Kate says
We are 18 months in to a 6 year IVA. We pay £120 a month but debts around 50K. I’m self employed and covid has meant I have’t worked since march as I have 4 young children, we have relied on UC. Husband is employed and We are renting. recently my grandma died and my parent have an inheritance. They have offered us a gift payment of 20k but only if it is used to clear our debts. Would there be a possibility of the company taking this amount as a settlement figure or would we just be expected to pay it as a lump sum to reduce our debts.
Sara (Debt Camel) says
If your parents gave you the 20k, it would all be claimed by your IVA firm and your IVA would just continue. But that is not what is happening – your parents are only going to give you you the money if your creditors agree to accept it to close your IVA. You will need a letter from them to show your IVA firm saying this. And then the momeny should stay with your parents until the proposal has been put to your creditors and you have been old it has been agreed.
BUT 20k is a LOT more than your creditors would receive if your IVA completed. I would have thought that they would be very happy to accept an offer of 8k unless there is some reason why your payments would be expected to go up in the next few years? SO it would be better to offer 8k to settle your IVA. Then when that is all over with, your parents could give you 12k if they want. Or perhaps offer to give you 2k a year for the next few years?
John Doe says
Hi
I lost my job at the beginning of Coronavirus and was forced to go self employed and set up a limited company. I haven’t told CreditFix yet as I just had my annual review and didn’t want to go through all the uncertainty of how that would work, given their terrible communication and general apathy. I have been keeping up my payments so far and it turns out that going self employed was the best thing I ever did. I should be able to pay off 100% of the original debt in within a few months. I’ve already got invoices out and business lined up to cover around 75% of it.
I haven’t been taking cash out of the business beyond my previous salary and was thinking I would withdraw enough to clear the whole amount all at once, as soon as it is available. I was wondering how the statutory interest rate and the IVA fees would work. The debt is around 20k and there will be around 3 years to go by the time the cash is there. Am I right in thinking the IVA fees will have been paid already, and there is just statutory interest and the debt to deal with? Is the statutory rate 8% per annum, or as an overall figure?
Or is there a better way to deal with this scenario?
Sara (Debt Camel) says
It’s 8% per annum so if you can settle after 2 years that is 16%. At a wild guess put CF fees at 4k.
What a pity you ever started the IVA, but well done & I hope the business thrives!
John Doe says
Thank you.
Yes it is a shame I started the IVA, and I strongly believe I was mis-sold it for multiple reasons. That is something I will be pursuing at a later date.
Also, they have added a 3k debt to the IVA and I don’t even know what it is. I suspect it is something from the 90’s, but I don’t know as Creditfix have consistently ignored my emails about it and don’t return calls. My understanding was that anything that hasn’t been recognised for over 6 years couldn’t be pursued, but I’m not sure.
Sara (Debt Camel) says
You can complain about this unknown debt. A debt that is statute barred still legally exists so can be included, but from what you have said, you don know what this debt is, if it is your debt at all or if the amount is correct. You can reasonably ask for details, saying including a statement of account showing whatever was paid to the debt saying that you were not aware of owing this amount and if you don’t, you want it removed from your IVA.
Sarah Hawkins says
Hello,
My IVA is now complete, I made my last payment in August
Creditfix have sent me the final documentation, however there was no explanation on what happens next
Could you advise please
Sara (Debt Camel) says
Thus article looks at what happens when an IVA completes https://debtcamel.co.uk/end-of-iva/.
Sarah Hawkins says
Thank you for the article thats a great help, however it advises that creditfix need to notify the credit agencies but they told me on my completion cert that i have to do it
Is that correct?
Sara (Debt Camel) says
If you check in a couple of months it should all be sorted without you doing anything.
Becky says
Hi, I am in a 72 month IVA and am 18 months into it. I pay £80pm and had a total of £21,770 of debt, so I would be paying 72 x £80 = £5760. I have paid £1440 so far and have offered a full & final settlement of £4400 in addition to the payments I’ve already made which totals £5840.
My settlement offer has been rejected and I’m really gutted. I had a baby this year and will not be able to return to work due to childcare costs, me and my partner do not receive any benefits or free childcare.
Do you have any advice to what you would do next or what would be a suitable offer to go back to my creditors with?
The £4400 amount was suggested by my IVA company to offer my debtors.
Sara (Debt Camel) says
has your IVA company suggested what the problem is?
do you have a house with equity?
why was your IVA 72 months not the normal 60 months?
Tracie says
I have a IVA over 60 months, taken out Jan 2018. I pay £100, however, due to Covid, redundancy, and changing job roles, my wage has decreased considerably. I have been paying every month up till now, but have been given a 2 month payment holiday, as my contract is 0 hours and temporary. I have a couple of people who have said that they would pay £7k to pay off my IVA at the end of the year. My original debt was around £11k, but when I have just asked creditfix what my balance is if I were to pay it off, they said £28k!!??? I know a third party can pay on my behalf, as long as they write to say that they want to pay and obviously have the funds to pay. I live in a flat, rented, so no equity. Thoughts would be appreciated.
Sara (Debt Camel) says
11k into 28k seems extraordinary even for creditfix. But I can’t see why you should offer more than the remainder of your IVA payments, which would be about 3k? Why have you offered 7k?
And honestly you should just think about possibly failing your IVA and switching to a Debt Relief Order (DRO). No payments AT ALL except for £90 to set it up. If your income has dropped that much, talk to national Debtline on 0808 808 4000 and see if they think you will qualify for a DRO.
Lyndsey says
Hi
Can you offer advice pls?
I have just been put at risk of redundancy. I have paid into an IVA for 8 months @£210 a month. I owed approx £23,000.
I’ve just received a PPI payment of £3850, and my parents have offered to give me £2000. With the job market being difficult I’m concerned I may not get another job. I have not equity in my property and currently quite depressed hence my parent offering the money.
Do you think the two payments together totalling £5850 would be enough to clear my Iva?
Any guidance would be appreciated.
Thank you
Lyndsey
Sara (Debt Camel) says
Has this PPI payment been sent to you? It has to be paid into your IVA now. This isn’t optional. And it doesn’t reduce what you have to pay.
So this doesn’t really help you settle your IVA. :(
At this early stage in your IVA, £2000 doesn’t sound enough to settle it.
Are you likely to get a redundancy payout? Do you live on your own?
If you are made redundant, then your priority has to be paying your mortgage, will this be difficult?
Ben says
Hi, I’m in a 5 year iva. Currently got 29 months left to pay, im being made redundant at the end of December, upto date I have paid £2450 of £6050. I rent a house and have throughout my iva. Would they accept an offer of the remaining balance? I am lined up to get a job straight away after being made redundant. But it will be for less money, not by much but still less.
Sara (Debt Camel) says
How much redundancy money are you getting?
You are paying about £100 a month at the moment?
How much less money will you be getting in the new job?
Ben says
I’m going to be getting aroind £10,000. At the moment I’m paying £120 a month. It started at £70 a month two years ago but this year has been £120 a month.
My pay hasn’t been 100% agreed for my new job yet but it will be very similar I’ve been told.
I’ve been in touch with my debt company and they have said if its a 3rd party making the offer then it will be around £3900 (debt left is £3600) but if I come into money then I would need to pay the full amount plus fees which would be in excess of £8,000?
Sara (Debt Camel) says
Is there a third party that could offer to settle this for you?
Ben says
Yes hopefully, does it have to be family or can it be friend?
Thank you sara
Sara (Debt Camel) says
anyone. But this needs to be done fast if you want it done before you are made redundant – at which point your lender will claim all your redundancy pay.
Ben says
Ok, do I have to let my iva company know I’m being made redundant before I apply for this?
Sara (Debt Camel) says
oh. I thought you had told them. You may want to read your IVA documentation to see exactly what it says, it’s not something I would be prepared to guess about.
David Anderson says
Hi, I was wondering whether someone could help me. I’m a year into my IVA and on my yearly review it shows 10k outstanding. I have just been compensated by HMRC and awarded 15k could I pay my IVA in the lump sum?
Sara (Debt Camel) says
What is this 15k for? Overpaid tax?
How large are the debts that went into your IVA?
Sally says
Hello,
I have paid £105 for 24 months, 36 remaining. My ex has said he would like to offer £3000 for a settlement of the iva as going forward he is reducing his maintenance payments by £200 a month and doesn’t want the children to suffer. (He is moving jobs to one with more security but the starting wage is lower than he earns now). I am renting and without the extra maintenance I won’t be able to afford the payments on the iva. Do you think this will be accepted?
Thank you
Sara (Debt Camel) says
Can you say how large the debts are in your IVA?
Sally says
They totalled around £16,000
Sara (Debt Camel) says
Then if that offer is rejected, you could fail your IVA and switch to a DRO, see https://debtcamel.co.uk/end-iva-change-to-dro/.
You could talk to National Debtline on 0808 808 4000 now about whether you be eligible for a DRO – this could give you some more confidence about your situation.
Tanya says
Hi I am in an iva I dont own my home I rent my iva is 60 months and have 38 months left so £3800 left to pay i pay 100 per month, my parents have offered £3000 for a full and final settlement do you think this would be accepted? I have not had any payment breaks and I’m not struggling with it due to covid 19 as my job is a key worker job and pretty secure but really would like this iva to be over many thanks.
Sara (Debt Camel) says
It isn’t a stupid offer. In these uncertain times your creditors may be happy to take that much now and complete your IVA. Well worth talking to your IVA firm about, but it may not be accepted.
Sarah says
I have 19 months left on my IVA i have been paying £160 a month. £3040 is remaining my mum has offered £2000 to see if it would finish.
Credot fix then came back and said the offer wasn’t enough. She now has offered £2200 but now there saying it would be £3340 as an administration fee would be added to finish early. My mum is poorly and my hours need to change, which means I would be paying creditors less. I just don’t know what to do.
Sara (Debt Camel) says
I suggest you say your hours are being cut and you need your IVA payments to be reduced. Get that agreed first. With only 19 months to go, if you cant make any payments a month then you can ask for the IVA to be “completed on the basis of the funds paid to date” so you don’t have to pay any more.
Hasan says
Hi, I am on 5 years Iva , total to pay was £9152 and £1500 Out of that £9200 Was for HMRC but that money wasn’t paid to HMRC so my other creditors So total for other creditors is £7200.
I have paid £1952 In one year n have to pay £5700 ( if I may not be wrong ).
Recently I was diagnosed with heart problem and it affected me badly and I can’t work like before .
My annual review in due now and in present year I earned less than the previous year ( on the bases of previous year my monthly instalments were fixed).
If a friend of mine offers £5000 lump sum will it be acceptable by creditors?
Sara (Debt Camel) says
I’m sorry to hear about your health problems. How much less a month are you now taking home?
Can I ask if you are buying a house or renting?
Hasan says
I m renting a house , my expenses are almost same but income got reduced by about £75 a month on average, though I still want to abide by Iva agreement if lump sum offer is refused
Sara (Debt Camel) says
OK so 3 thoughts – and with these “offers to settle” no-one KNOWS what will be accepted, some times great offers are declined or poor offers go though…
1) most people expenses have gone up a bit over the year – rent, council tax, heating etc are you sure yours hasn’t?
2) as your income has dropped, you should be expecting your IVA payments to be reduced. I think it may be better for you to get the review done now and argue for a reduction – give them the medical evidence about your health. And then if the amount is lower, it will be easier to get a lower offer accepted.
3) you say you want to carry on if the lump sum offer is refused. I think you should think again about that if it happens. If in a year you have to do less work, you will be in a worse position. Unless you had any assets (did you?) there probably was no reason to have gone for an IVA not bankruptcy. More than 30% of IVAs fair…. bankruptcyies don’t.
So I suggest
– get your review done now and get as low a monthly payments as possible agreed
– then make an offer to settle the IVA
– if that is refused look seriously at bankruptcy,
Hasan says
Hi, if my remaining IVA balance is £7200 and I offer £5000 lump sum for final settlement what’s the chance of acceptance?
I completed one year and still 4 years to go.
My friend offered the money . I have no personal Moveable or immovable property at all . My income reduced in last year and I have health issues as well
Sara (Debt Camel) says
Have you had your annual review? If your income has reduced, have they cut the amount you have to pay each month?
Sorry to hear about your health, do you think that will mean you may earn less next year?
Are you buying or renting?
Hasan says
No review has been done yet but I requested to consider this offer with review.
My health problem is long lAsting and it will definitely affect my future income
Sara (Debt Camel) says
I suggest you wait until the review is complete as that will give you a much better idea of what a reasonable offer might be.
Hasan says
Will my annual review and request for early settlement not be consolidated n consider together ? I have already given them proof less income As compare to previous year
if one has health issues how can give documentary proof of it? I M on IVA and recently had health problems ? Will my GP give me a letter or I can authorise them to get information from GP directly?
Sara (Debt Camel) says
I don’t know. It will depend on how your IVA firm wants to handle it.
You can ask your GP for a letter – some may charge for this. Otherwise a list of items on prescription, copies of appointments at clinics of a hospital; etc can be helpful.
AMY Jones says
Hi I am around 3 years in to my IVA, It was for £9000, I now Know it was a mistake entering in to the IVA with such a small amount, as it has completely restricted everything ive done for the last few years, but hey ho you live and learn. I have been offered by my partner to pay a final amount of £3000 (£4600 would have been paid if i stayed on the IVA for the remaining 2 years) I have been told today that the variation meeting went ahead and my creditors have accepted the final offer of £3000. I have the money in my account I am just waiting for them to send me the details of the meeting. After I have paid the final amount, will I have to do another review? I am worried if so because I have just switched over my bank account due to a lot of payments failing through no fault of my own, I can provide wage slips but due to being in a new job I only have the last 2 months worth of wage slips and cannot ask my previous employer due to the circumstances I left. Any advise would be appreciated.
Sara (Debt Camel) says
There will normally be a final review. You should have a P45 from your previous employer? That should be ok instead of payslips.
Amy jones says
I havnt had it off them yep. I have found screen shots of the front of my wage slip for the last year which shows my net pay but doesn’t show break down of salary. Do you think this will be enough?
Sara (Debt Camel) says
possibly, but it depends on your IVA firm.
Amy jones says
It took exactly 1 month it was my 2nd offer so I would say try and get the amount right first time.
Hasan says
Amy, what was ur first offer and how long did that take to be decided ?
Amy jones says
It was £1000 less then the one accepted. It took a full month. My Iva Is with credit fix apparently it always takes that amount of time
Ben says
Hi Amy, I have a question, when your first offer got declined were you able to make the second offer straight away? I have been told you have to wait 6 months to make the next offer.
Sara (Debt Camel) says
This may depend on your IVA firm. Creditfix charges £300 a time for putting forward a settlement offer do they may be happy for yoh to do several. Others don’t.
Hasan says
Hi , how long does it take to accept or reject my request for early settlement of IVA ? Rough idea ?
Sara (Debt Camel) says
Your IVA firm will have to propose this to your creditors who will vote on it. It isn’t quick – months.
Hasan says
And during this time I will pay monthly instalments as usual?
Sara (Debt Camel) says
Well hopefully they will be reduced at your annual review…
Hasan says
I have completed 1 year on 5/12/20. You think my next month instalment will be taken after annual review?
Sara (Debt Camel) says
I can’t guess what your particular IVA firm will do. If you can’t afford to pay the next instalment, tell them now!
Hasan says
How much time does it take to do annual review?
Sara (Debt Camel) says
this depends what the review finds & on the IVA firm.
I understand you are worried and want this all sorted asap, but there is nothing you can do to speed this up at the moment. Obviously if you areasked for any info you need to get it to your IVA firm as soon as possible.
Hasan says
Thank you sara
KHALIL says
Hi Sara, Hope you are fine.
Sara I have had IVA and I am half way through. total for 6 years.Got divorced, total monthly IVA was £175 so they(creditfix) split the money for us
87.50 each
we have continued like this over an year now
3 years remaining now
36X87.50=3150 for me
36X87.50=3150 for my ex
now question :)
1- can I pay mine £3150?all in one early
as i wanna leave the country
so my family offered to pay for me
3 years gone
3 years to go
please any advice Sara
Thank you so much and stay safe :)
Sara (Debt Camel) says
You need to ask Creditfix this I am afraid.