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Rakhi Vasavada
Rakhi Vasavada, Financial Advisor
Category: Finance
Satisfied Customers: 4473
Experience:  Attorney and Financial Expert. Have specialization in Financial Laws.Practice experience of over 13 years
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A friend is in debt to 6 credit companies he is up-to-date

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A friend is in debt to 6 credit companies for 25500 he is up-to-date with minimum repayments. However his situation is such that he can no longer service the £677/ month due to changes in personnel circumstances. I have suggested that he negotiates with the creditors for a full and final settlement of of 10000 prorarta which I will loan him. A debt management company after accessing his financial situation have said that they would propose to the creditors a £210 / month IVA. Should he go with the debt. management solution or the DIY full and final settlement. There is also a FFS IVA this was suggested to the IVA company who said that they thought the IVA should run for 18 months before doing a FFS IVA
Submitted: 1 year ago.
Category: Finance
Expert:  Rakhi Vasavada replied 1 year ago.
Dear Friend,Hello and welcome. Thank you for providing an opportunity to assist you.I believe IVA would be better looking at the outstanding amount. A 'guide' figure for how much debt you need to qualify for an IVA is around £12,000 - £15,000. If you have less unsecured debt than that, then a debt management plan might be more suitable. The reasons I am suggesting for IVA are == Even if IVAs are not flexible, they stand as formal arrangement between the party and the lenders. Also, it will stop all interest and charges as well. An IVA has a guaranteed end date. This is usually after 5 years. It can carry on for an extra year under some circumstances. Further more, once IVA becomes operational, all contacts from creditors will stop. So, in my opinion, rather than going with a personal arrangement, you should opt for IVA. Personal arrangements work fine with smaller amounts, but with this, I believe IVA would be a better option. I am sure this would help. I wish you good luck.You may please leave a positive rating if this helps as this is the only way we are compensated for assisting you. Alternatively, you may revert back with a reply if you need further assistance or if I have missed out on any aspect of your question.Warm Regards,
Customer: replied 1 year ago.

If an informal settlement is made there would be no interest charges. Are you saying that a full and final settlement could be reneged on by the credit companies?

I was unable to get back earlier due to problems accesing justanswer using IE this has been resolved by contacting support and using crome

Expert:  Rakhi Vasavada replied 1 year ago.
Dear Friend,

Hello and welcome again. Thank you for your reply.

If you are going for IVA, it cannot be informal affair. Yes, you rightly understood that full and final settlement could be reneged on by the credit bureaus.

I believe, IVAs being a completely formal and documented affair, one should opt for that.

I am sure this would help. I wish you good luck.

You may please leave a positive rating if this helps as this is the only way we are compensated for assisting you. Alternatively, you may revert back with a reply if you need further assistance or if I have missed out on any aspect of your question.

Warm Regards
Customer: replied 1 year ago.

I am sorry but I have contacted an independent debt charity who say that an informal FFS will not be renaged on as long as I have the paper work to support the agreement.

Expert:  Rakhi Vasavada replied 1 year ago.
Dear Friend, Yes, I agree. What we were discussing about going for IVA. Warm Regards,

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