Hi
I am about to apply for an IVA and need some clarity about my car. I have a car loan (not HP) through a firm that works with my employer. The monthly payment is taken directly from my salary before I receive it. There is just over two years to pay of a 4 year loan. There is £3K left to pay and the car is worth about the same as what is owed. I need my car for work and it is in my contract of employment that I provide one. I had thought that as I never actually get this money that my employer would continue to pay the loan from my salary and the net amount left would form the salary for the purposes of the IVA. I now have doubts that this can happen. Do you have any advice please? Also, I am thinking of changing the car. As I said, if I sold the car it would just about pay off the outstanding car loan but how would I then finance a car if I was inan IVA? Could I still get a loan for another one? As the existing loan is on only 1.75% interest I'm reluctant to give it up if it can continue through the IVA.
I think it may be possible to exclude the car loan from any IVA with the agreement of your other creditors and for you to continue to pay this via your employer. I think you need to explore if you have to go through a credit check when the car loan finishes, in order to obtain another car, because this is where you may run into problems
I have just got a car through work. I dont know if it works the same as yours though. The car is paid for through my salary, so its taken at source. This isnt included in my IVA as its not technically a loan, more of a lease.
Goffey - is yours actually a lease car ie you have it for a fixed term and then it is returned to the owner or do you actually own the car so that it is registered in your name.
If the loan is an unsecured on in your name, then it needs to be included into the IVA along with the rest of your creditors. The fact that the payments are deducted directly from your salary makes no difference. Is the car loan provider linked to your employers at all?
The car is a lease car brightie. It is done through work though for a fixed 3 year term. The money is taken from salary before i get my take home pay, so I get less to take home. HOWEVER....i do have a car on HP. The repayments are huge, and much more than the lease car. This car is going back to the finance company, but my IP said that if i hadnt got the option of the lease car then the cost of the HP would have been built into my outgoings as without a car i cannot work. If it had been a loan it would have been included in my IVA.
So long as you keep up the lease payments, then your car should be safe. As this is deducted from your salary, make sure that your IP grosses the salary back up, and shows the lease payments separately, so you will have a larger 10% allowance on which to base your uplift payments.
I lost my car 1 year into our IVA as Ford would not entertain us any further due to being in an iva, Even though we had never missed a payment. My IP said this would not happen before we entered into our Iva....but it did......be careful!!.
An IVA is a long hard road but valuable lessons have been learnt along the way. Now looking forward to enjoying a debt free future!
