Hi,wonder if anyone can help me, I have just come out of a 15yr relationship from this ive been left with a real headache,my ex and I had debts of approx £75k all this debt is in my ex''s name bar £27k which is in joint names, its part of a together package with northern rock, this £27k being unsecured.Now my ex has entered into a IVA for all of the £75k I believe at 5yrs and £496 per month payment with a remortgage at a value of up 85% of the property at the end of the IVA, now my problem is northern rock have accepted the £27k into the IVA without even any contact whatsoever with myself asking my thoughts or anything, now my ex tells me that they will be chasing me soon for the remainder of the loan that being 58% could this be right? if its been accepted into the IVA by northern rock? firstly why accept a joint name loan into a IVA without any contact with myself,secondly if they can do that why is it not 50% of a joint loan, thirdly this IVA has now prevented my ex from being able to buy me out of the property,forthly I believe I can force sale of the property but where would that leave my ex regarding the remortgage at the end of the IVA if the property is sold now and criteria isn''t met on the IVA
I can't answer all of your questions, that needs a technical expert, but I'll do what I can.
For the joint loan, you will be chased for the whole of the amount, not just half. For it not to affect you, you will need to keep up loan repayments on that.
Your ex can still try to buy you out, an IVA does not prevent this, but I doubt he would get a mortgage given his credit history and the housing market at the moment. You will probably find that a restriction order has been placed on the house as well so that you cannot sell it without the IP's permission. If it were to be sold, some of your ex partners equity would go towards your ex's IVA.
I can't help you with why NR haven't been in touch with you.
Sharing from experiences of dealing with debt
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Hi there - well you certainly have a considerate ex-partner there! Fancy going ahead with an IVA with absolutely no thought for how you would be able to service the debt to Northern Rock - for which you are responsible for the whole amount and not half, under the principle of joint and several liability.
First of all, are you able to continue to make the contractual repayments to the loan? If so, you should continue to do so, and the loan will continue to reduce in line with the original agreement, and your ex-partner's IP will also make dividend payments at regular intervals which will reduce the liability further. If you are unable to meet the ongoing contractual repayments, you should contact Northern Rock directly to see if they would be prepared to lower the payments for you in light of the circumstances.
Secondly, your partner has agreed to re-mortgage your property during the final year of his IVA, without reference to yourself. I am suprised that his IP would do this without getting a letter of consent from you initially, and you will be required to sign Form RX1 allowing the IP to place a restriction against the property effectively precenting you from selling it without the IP's knowledge or permission. You could refuse to do this, which would effectively place the IVA in jeopardy, but perhaps the best thing would be for the property to now be sold and for you both to receive your share of the equity now - which you could also use to reduce some or all of the NR liability.
Is there currently any equity in the property, and are you both still living there or just your partner?
I agree with Melanie in respect of the property which appears owned by both of you. There would be a requirement for you to have signed the form RX1 as a term of your Partners IVA - did you do this? What is your current financial position? Are you able to continue making your payments?
Regards, David Mond, Insolvency Practitioner for over 46 years. Personal Insolvency Practitioner of the year 2012, Personal Insolvency Practitioner of the year finalist 2013 & 2014 awarded by Insolvency & Rescue Magazine and 2015 finalist for Personal Insolvency Firm of the Year.
Hi Melanie and David thank you for your quick response!
Melanie, in response to your questions, as it stands I would find it very difficult to repay the contractual agreement on the loan, you see my ex partner was the bread winner to put a point on it,myself middle teens salary and her above the 50's (and she's the one who has gone into the IVA) I have not seen ANY paperwork regarding the IVA and I have not signed anything
thou I have asked via a solicitor for a copy.At a rough estimate with todays climate I say that there is 12k equity in the property, and my ex partner is living in the property.David in response to yourself as I put to Melanie I have not signed anything at all this has been done so to say behind my back! As for my current financial position I am close to what's coming in is going out, but with this added debt I would find it very difficult to manage on my salary.I have thought of an IVA myself but only have one other debt with this loan of 27k (the one that is causing me this headache) my total debt would be 30k, and what would my position be regarding the remortgage on the house at the end of the term? as my ex partner as said she is remortaging for her IVA, also what would happen if i forced sale now then she cant remortgage (as the house would of been sold) at the end of the 5year IVA and can't meet the criteria of her IVA in full at the end of the term?
First of all your partner cannot remortgage the property without your permission or knowledge - assuming that it is registered in joint names with a joint mortgage. She has been a little silly in assuming that you will go along with her plans, and her IP ought to have checked with you that you were in agreement with this. If you decide to not co-operate in this regard then her IVA will possibly fail.
However this does not help you with regard to the NR loan. If you are unable to offer anything towards the loan, then it may be better for you to invite Northern Rock to charge the debt against your share of the equity in the property, or consider bankruptcy proceedings. The first option will leave you with a debt, to be discharged when the property is eventually sold, but will make it more difficult for your partner to re-mortgage in the final year - which could work to her advantage. Northern Rock may agree to this, and not pursue you for any payments, but you would need to negotiate closely with them in this regard. Bankruptcy would take the debt away from you for good, but your equity in the property would vest in a Trustee, who would want to realise this for the benefit of your creditors - again this would affect your partners IVA.
What you have here is a bit of a pickle, which ought to have been identified by your partner's IP at the time her proposals were being drafted. I suggest that the same professional now needs to sort this out, and it would do you no harm to contact them directly to seek their advice as to how you may deal with this.
Yes I agree with Melanie - write to your Partners IP and ascertain how your partner and in what circumstances was it suggested that you would concur.
Also you might be able to re-negotiate with NR and see what they have to say.
Let us know how you get on Good luck.
Regards, David Mond, Insolvency Practitioner for over 46 years. Personal Insolvency Practitioner of the year 2012, Personal Insolvency Practitioner of the year finalist 2013 & 2014 awarded by Insolvency & Rescue Magazine and 2015 finalist for Personal Insolvency Firm of the Year.
