www.iva.co.uk

advice please..several questions..iva run for 5 years so far, 40,000 equity in house not accessible due to our age so further 12 months payments asked for..first extra payment made. problems with income swiftly approaching..if we sell the house how much of our equity will the iva take..all of it? thanks

Hi and welcome,

You would have to inform your IP that you want to sell the house as there is a restriction lodged with Land Registry.

If you are having problems then speak to your IP and ask if they will take payments made to date as a full and final settlement.

This is an interesting one, and I would appreciate an Expert's take on this:

If the 12 months extension has been agreed in lieu of equity, surely, now, the property should be excluded from the arrangement and the RX1 restriction lifted. Or, would failure to complete the extension mean the property is still "at risk" (so the restriction remains, in case) ?

That apart, I would imagine that you could pre-empt matters and go to the creditors with an offer to sell, in order to clear the IVA, giving them an amount you feel comfortable to hand over, this would stipulate that you will not sell if the offer is rejected.

If the property is still considered to be an asset (per my opening question), which I suspect it will be, and you sell regardless, they will take such equity as is required to clear the total outstanding, original, debt, plus fees and possible statutory interest.

I would think unless and until the 12 months worth of contributions has been paid the property is at risk.

I.e they breach the terms of the IVA equity is at risk by way of Bankruptcy due to the breach.

As I see it the options are:

1. Struggle on with payments
2. Have payment break and extend IVA to allow more time to make up payments
3. Find family member or alternative source of funding to pay remaining 11 months (pension drawn down last resort?)
4. Ask IP to use discretionary powers to reduce the level of contributions so they are more manageable
5. If 4 not possible ask IP to call variation of creditors to accept payment following sale of property.

It would be such a shame for you to have to sell your property at this late stage simply to find 11 more months of payments. It would presumably like using a sledgehammer to crack a nut.

How much do they total out of interest?

thanks Lisa and others for help at a very stressful time. we are in poor health and our income source from work will soon cease. we have 11 payments extra to make of £866.00 a month. our main mortgage finishes in October this year when our mortgage current account £70,000 approx. will fall due for repayment. currently owe about 80,000 with valuation of house about 120,000. our son has offered to pay off in one sum the remaining 11 payments but to my surprise instead of grabbing this offer with both hands the IP have asked for 3 months statements, income proof and outgoings before they will approach the creditors for a variation!! we want to clear the IVA and then get full benefit when we sell but not as easy as we thought. any more help much appreciated

Hi - who is it they are asking for bank statements for - you or your son? If you son is offering to pay the c£10k up front then all they should need to see is evidence he has the funds.

Alternatively if that doesn't wash perhaps your son could simply make the monthly payments for you instead.

As regards the mortgage position perhaps you can renegotiate with the Bank. Ryan or Shaun on the forum might be able to help here.

Some of this is linked to money laundering regulations.

May be best to do as Lisa suggests.

Hi Lisa. Asking for our bank statements etc not our sons..they say all they want is a confirmation letter from him, he will never be contacted direct. I'm trying to be careful as I am well aware that the IP is on credits side never ours!! problem is we are in our late 60s, carers whose contracts will end in June so we will then struggle with the mortgage payments never mind the IVA.. struggling through thick mud at the moment but thanks SO much for the advice

Surely if your income will be reducing/ceasing, your IP should review your I&E and reduce your IVA payments? If that is a few months from now, then I would hope that a decent IP would put a variation forward to the creditors for a F&F based on the payments you have made over the 5 and a bit years. I would suggest you sell your house as the very, very last resort as I suspect the equity will be taken into the IVA as stated by other posters. Good luck.

many thanks esgt1967, sure selling is the last thing we want to do..just getting tired now and want the whole thing finished..been a very long 5 years!!

Best of luck - I hope this gets resolved in a reasonable way. Please note however that the Supervisor does have to oversee the arrangement to make sure you don't breach it. In order to vary it they will need to see evidence regarding your reduced income etc so that creditors can make an informed decision.

Hopefully your sons money won't be needed.