IVA if secured debts are over 40% of your income

[pab]

Dear Sirs,
i have been told you cannot enter an IVA if your secured debts(ie mortgages) are over 40% of your monthly income is this true?

[MelanieGiles]

Hi pab

It is not true to say that you cannot enter an IVA with such critieria, but it is correct to say that some creditors may reject your proposals.

To be honest, if I see clients with such high mortgage repayments this sets alarm bells ringing in my head too - especially in these days of uncertain interest rates. If you are presently paying a repayment mortgage, you may like to look at going interest only which reduces the level of your outgoings, or if you have a mortgage and a secured loan, why not look at consolidating the two for similar reasons.

Barclays and Lloyds banks, as well as MBNA and Egg, are particular haters of high secured creditor repayments within monthly expenditure budgets.

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

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[neverending]

Hi
Don,t be put off by the 40% figure.
A family of six paying 30% of their income will have less disposible income than a single person paying 40%,so there should not be any standard line taken by creditors[although there may be ]

I have succesfully paid an IVA for three years with a mortgage close to this figure.
Don,t forget that the creditors will take part of your equity in the final year of your IVA and also that an IP should not propose the IVA if they felt that it would not get accepted.
Speak to a company on this site and see how you get on.You have nothing to lose.