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If I take up an IVA, can I retain the car finance (2 years to run), and keep my car? I have a large personal loan with the same company that provided the car finance.

Hi there

As the car finance is likely to be secured on the vehicle, then you will need to continue to make the monthly instalments and keep the car, but your payments will be increased in direct proportion when the agreement has concluded. The personal loan will be included as an unsecured creditor, and there is no real linkage between the two.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

Would I be right in thinking that the finance company could request the car be sold to release money owed on the loan if it's valued over £5000.00.

Cars on finance where the real value V outstanding finance.

If there is negative equity and the car is an average car, it is nost likely that creditor will take the view that if the car is sold and there is negative equity this will only reduced the dividend in the IVA.

Creditors are more likely in this situation to ask for an increase equivalent to the finance payment to be added to the Voluntary Payment once the finance has finished being paid.

If there is equity in the car and the value is greater than £2,000 (this figure is not always the same, depends on creditors and I am sure the forum will all have experienced different things with this, so take this as a general view) you may be asked to sell the car and buy something cheaper.

I have also had it said that if the realisation is less than £500 then creditors will not ask for the car to be sold.

Cars in Bankruptcy and IVA's are a bit of a nightmare, but normally a compromise can be reached.

If you want any further info give me a shout


Dave Beech

I very rarely see my clients asked to sell their cars. It's all about justification really, and a car valued at only £2,000 may not be likely to last the five year term of an IVA.

Why do you get nightmares about cars in IVAs Beechy?

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

Because they are an inanimate object but people tend to form an attraction to them.

Dave Beech