Hi, I am just organising an IVA and gave the keys back on my BTL property, as these are the reasons for my financial problems. One property is still rented and the lender says they wont take possession until i get rid of my tenant. This could take months - I know from previous experience. Surely they have to repossess if I am not paying the mortgage. Mainly I am worried that my IVA will not be able to proceed because of this. The properties are all in negative equity and I have given the expected shortfall to my IP based on property prices in the area. I am so worried and not sleeping. Can you offer any advice please about my IVA? Very many thanks.
Not sure if your mortgage lender has to do anything.
I assume you have an 'assured shorthold tenancy' agreement in place. If so, surely you just have to give your tenants their 2-3 Month's notice to quit, and that should be it.
Seek advice from, and update your IP accordingly.
I doubt this will stop the IVA proceeding, but speak to your IP.
Good luck.
My opinions are just that: Based on my experience and being a self-employed IVA customer.
Speak to your IP for advice as it will probably take longer to repossess than get your tenant out. When you say it is the reason for yur problems...do you mean the negative equity in itself or is the rent not covering the mortgage and leaving you with a shortfall each month?
The properties have cost me a fortune over the 4 years, the area has become very bad and problems with drugs and tenants and the management company not doing repairs. Come to the end of my tether with it all and the worry. Ended up using credit cards to pay repairs and mortgage as no one wanted to rent the others. This tenant doesnt want to go, despite being given notice and I cant afford the court fees and stress. Negative equity is around £20k each of the 4 properties.
Doesn't sound great! Speak to your IP and if all else fails, just stop paying the mortgages - you don't want the properties anyway so it's of no consequence to you if they repossess. Although it will impact on your ability to obtain future mortgages. The IVA should be able to proceed with anticipated shortfalls for the property but your IP can advise better than me. Good luck with it all.
The mortgagee does not have to possess the property, although if you have voluntary surrendered it then they have little choice but to take resposibility for it moving forward. That said, it is probably better to wait until the tenancy has expired and the property is vacant again, and this shoudl not affect the commencement of your IVA as shortfall figures will have to be estimated until the property is sold in any case.
