I have recently entered into an IVA. I have a mortage currently for my home and would, next year, like to move in with my boyfriend but my worry is, as he has a mortage too, will my IVA affect him? I understand that my house currently has no equity and that I will need to re mortgage in year 4 but, if I sell my house next year and want to move in with my boyfriend, will I affect his home in any way? I realise any money made on my house will go towards my IVA and, because i can't get credit, I will not be able to get a mortgage with him so, in this situation I will pay him rent but not sure if this will do him harm financially.
Your boyfriend should not be affected at all. Paying a rent is a good idea as it reduces the risk of creditors claiming that you have acquired a beneficial interest. It may be an idea to rent out your own property if the rent covered the mortgage and let market conditions improve. You may then raise enough at a later stage to sell and offer a full and final settlement.
Hi Michael and thanks for your reply. Unfortunately my house is Shared Ownership so I am unable to rent it out, otherwise that would have been a really great idea. My worry about renting from my boyfriend is that, after I've been paying rent for a time, whether it would be assumed that I owned a small percentage that I'd been paying rent toward and that, in this circumstance, my boyfriend would be forced into buying out my small share to pay towards my debts and I don't want to involve him in any of my own debt problems. Does anyone know if this would happen?
Many Thanks
It is extremely unlikely that anyone would try and claim you owned a piece of his equity. However, to be sure you would need to show that what you are paying him in rent is not excessive and no more than you would have to pay if you rented privately. In addition it would help to show that he can pay the mortgage and run the house without your money and you are in effect a lodger.
If your boyfriend is not working for example and you paid everything it would be difficult to say you had no interest in the property but otherwise it should be fine.
If you organise your finances seperately, it would be very difficult to demonstrate that you have an interest in the property.
Moving in with your boyfriend my mean that you have increased surplus do to the savings you make sharing the household expenditure, so be aware that on moving in together, you may be asked to increase your contributions.
Kind regards,
Angela Rosler
Insolvency Manager
Helping people with their debt problems for nearly 10 years.
Contact me directly for free, impartial, confidential help and guidance.
