i currently have finance on my car

[buster]

i currently have finance on my car and the car itself is probably worth less than the finance yet i would like to continue with these payments as i need a car for work. can i keep the car if i were to go into an iva?

[plasticdaft]

Is the car on HP or a loan??

[buster]

the car is on a finance loan, if i were to sell it i would have to pay off the finance and probably have to find more money as the finance settlement figure is higher than what the car is worth. it costs me £197.00 per month and runs for another four years.

[GinSkipper]

Hi Buster, I am stil waiting to attempt an IVA myself and had the same questions as you. While you should check with an IP, I was advised that if you can justify the car for work an dthe payments are not excessive then you should be able to keep it. Like you, mine is on HP and would need more money to hand it back and still need to purchase another vehicle.

Good luck.

Andy

[plasticdaft]

HP and loans are treated differently I think. Hp payments can continue to be made outwith the IVA,I dont think the loan can be handled the same.

[Adam Davies]

Hi
HP can normally be continued alongside an IVA and then once finished the payments used for the HP can be added to the IVA payments.
All pretty standard
Regards

[plasticdaft]

What about loans that are secured on the car Andy??

[buster]

i have just rang the finance company and the settlement figure is nearly £1000.00 more than the book price of the vehicle. it is on Hp, settlement figure is £6845.00

[Michael Peoples]

Hi Buster. As Andy said there is not really a problem with cars in an IVA as creditors realise that it is needed for work. Some smaller HP companies do threaten to repossess cars even in an IVA but most lenders are happy to continue receiving the payments. There are limits and creditors may well object to large payments for a luxury car but less than £200 per month will not cause a ripple.

[Adam Davies]

Hi Platicdraft
If a loan is secured on a car then it is HP or a lease/lease purchase and will carry on,if allowed by your creditors, outside of an IVA.
Any other loan would be a personal loan and will come into an IVA.
Regards
Regards

[buster]

thanks for your help. I have been watching lots of issues/comments for some time now. Just set up a new bank account but i will keep paying things until i can't anymore and pray for a lottery win! Money is not cheap to lend anymore aswell as getting extremely harder to borrow, i'm sure more people will be joining me shortly.
Again, many thanks for your help.

[MelanieGiles]

Do make sure that you all check those finance agreements to ensure that they actually are HP agreements. Some banks use unsecured loans to finance car purchase, but they look incredibly similar to HP agreements, and I am convinced that the average car salesman does not know the difference.

[David Mond]

Normally a HP or finance agreement for the purchase or lease of a car can continue during the period of an IVA, provided it is not an excessive amout and when payment terminates the saving will have to be paid into the IVA.

[plasticdaft]

So even if its an unsecured loan the finance company have given you,you could keep it out the IVA?? I thought it all had to go in??

[Michael Peoples]

Unsecured loans must go in but there could be a problem then with the vehicle if it has a high value and no finance. Creditors may ask for the vehicle to be sold and a cheaper one bought. In addition the finance company may not be prepared to accept an IVA for a recent high debt.