Author Topic: New member: bankruptcy escapee  (Read 2561 times)

michaelmac43

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New member: bankruptcy escapee
« on: Nov 03, 2012, 07:05:18 PM »
Greetings from a new member.[/size]A few years ago I was severely in debt and I was advised to go bankrupt but I wanted to avoid that. Luckily a helpful Insolvency Practitioner gave me some free advice. Yes, her firm could arrange an IVA but there would be substantial fees. She showed me how to negotiate deals direct with all my creditors, while avoiding IVA arrangement fees. Through her advice, and with good support from the CAB, I managed to do that.It took time. It also took lots of letter-writing; but that way I always had a record of what had been said. What I learned, and what I always advise other people who are in the same situation, is this: don't negotiate on the phone, because it's more stressful and you have no record of what was said on either side.

Steven Jackson

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Re: New member: bankruptcy escapee
« Reply #1 on: Nov 06, 2012, 11:51:04 AM »
Hi michaelmac43
Good to hear about your story and some very good advice there about negotiating with creditors. May I ask at the time you spoke to the Insolvency Practitioner what fees were mentioned? If you were planning on proposing an IVA today there would be no up front IVA arrangement fees at all. Of course part of the payments you would make each month would be taken in fees. However you do not have to pay these as extra and so in many situations this can be a better result than even trying to negotiate a debt management plan and early settlement of the debt yourself.
 
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michaelmac43

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Re: New member: bankruptcy escapee
« Reply #2 on: Nov 06, 2012, 01:13:36 PM »
Hi Steven


The fees mentioned were of the order of £5000 - £7500 but I can't remember the exact figure.


As you say, the current situation is that you normally wouldn't pay it upfront; at that time I think that's what I was facing.


For some (maybe most) people, the idea of negotiating direct wouldn't work. My advantage was that I was able to release part of a pension, so I had access to a lump sum and could thus offer a "full and final" deal. Most debtors would not be able to release funds from a pension (or even if they could they might not choose to), so making monthly payments under an IVA, with fees netted off rather than being an extra, might be better for them. It's definitely a case of "horses for courses."