What is a Full & Final IVA
Written by PayPlan on 5 April 2011
If for whatever reason you have received a sum of money, no matter how small or large, you may be able to use that to pay your creditors in a Full & Final IVA.
Today I am going to explain what a Full & Final IVA is and discuss the criteria of it.
What is a Full & Final IVA?
In brief, with an IVA you make an offer to repay your creditors a percentage of the debt that you owe. For example if you owe £50,000 you would need approximately £10,500 to offer a dividend that creditors may accept.
With a Full & Final IVA, everything is done exactly the same; instead of making an offer for 60 monthly payments you will offer one payment, however your creditors may put forward modifications depending on your surplus.
You would have to submit proof of the funds that you are using for your IVA and you would need to do this on top of the other documentation that is also needed for your IVA proposals.
I have been made redundant & received a pay out.
If you have received a windfall such as a redundancy pay out then you may be able to keep a certain amount of the funds before putting the rest of them in an offer to your creditors. If you have been made redundant and have received a pay out and are still seeking new employment then it may be a possibility for you to keep some of the money that you receive in order to pay your bills and other expenses. In these circumstances, you need to make sure that you are offering a realistic amount to your creditors otherwise they could ask for the full amount. The equity clause that is in standard IVAs does not apply to a Full & Final IVA. You will make one payment only and then your IVA will be complete. However if you have substantial equity in your property then your creditors may decide to ask for this to be included.
Although you only make one payment, IVA will stay on your credit file for six years and as with all IVA’s you will still need to be regarded as insolvent.
If you are struggling with debts then please call Payplan
Free IVA Advice
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