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Morning all,

This is probably a no no but wanted to ask.

Nearing the 1st anniversary of my IVA, it's gone very fast and though tight is manageable.

I pay just short of £1000 a month and will for another 54 months as I'm buying out my equity release clause with a further 6 months payments. Which I realise was very lucky.

My question,

My property was valued very low when the IVA proposal was drawn up because of extensive building work in the area at the time. This has now finished and, even though I know the property market has flattened, similar properties in the local are now selling well.

I think I could sell in the spring and, fingers crossed, come out with around £40k. I don't want to leave the property market so would I would be looking to buy something else, in perhaps a less expensive area, with a similar monthly repayment (£1300) and use the money from the sale of my current property as a deposit. Making no immediate financial gain.

Do you think
The IP would let me or would I be expected to hand over the profits and move into rented accommodation. There is a modification in my IVA about any newly acquired assets being handed over, and a new property might be considerd as that.

b. (and this is probably for the mortgage brokers) reading about the impact of the so called credit crunch, would the idea work. Or would the penalties any lender would apply negate any benefit.

The main reason for e even thinking of this is that even though I know I have a responsibility within the IVA to make recompense for my irresponsible financial behaviour there has after all got to be life after an IVA. I think a nice DIY property renovation project would keep me busy and be a sound plan for the future.

regards

Hi
Only your IP will be able to answer this one ut as it will not affect your ability to pay your IVA and you will not be in a windfall situation then I can see no problem.Just be 100% sure that your original IVA excluding the property is water tight,otherwise if you alert your IP to 40k of equity they may be duty bound to explore further.
To be honest I would sit tight.

Andy Davie
IVA.co.uk Spokesperson

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Thanks Andy,

I thought as much. And, I do appreciate how lucky I am not to have an equity release clause. So I guess you're right no point in rocking the boat.

Hi there

It sounds as if your property was excluded from the IVA on grounds of the additional payments, so there should be no problem in selling and using some of the money to make an offer to creditors - so long as you are able to offer a dividend similar to that originally offered.

As £40k is lower that the £54k you say you still owe, you are somewhere short of the mark, and if your new payments are going to be similar to the old payments you will still be left with surplus income, so you may need to pay for a few more months just to make up the difference.

If I were a creditor, I would probably question the original valuation as your property does seem to have increased a lot in value over a relatively short period, but take your own IP's advice as to the possibilities with your offer.

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

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