SELL UP OR NOT???

[flashingblade]

Hi all

Havent been on for a while....been trying to forget our debt now we're 5 months into our IVA!

I need some advice...

We are thinking of selling our house, paying off the mortgage and the secured loan, and hopefully have enough left to offer a lump sum for an IVA, around 10-15grand and then renting a property. At the moment our mortgage is interest only, and so at this rate we will never own it anyway. This would make us £300 a month better off, and whatever over time and benefits we could get and we would be DEBT FREE!!!!

So do we leave the property ladder?? or should we stick it out for the next 4.5 years??

Any replies would be great!

[flashingblade]

anyone?!!!!!

[MelanieGiles]

Hi Flashingblade

It is rather early on in your IVA to be altering the basis of your settlement. How was the property treated within the IVA - equity release during the final year? If so, it is unlikely that your creditors would want to accetp an early settlement now.

There would be nothing really to stop you selling your property, however, and making enhanced ongoing contributions as a result of your £300 saving. But this would need to be agreed by the creditors.

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

[flashingblade]

Thanks Melanie,

We would only be £300 a month better off if we sold the house and use the equity to pay off all our debts which is the iva, and the secured loan.
By the time weve sold our house id reckon we would be a year plus into our IVA, and i thought creditors would prefer a lump sum rather than waiting for it??

[MelanieGiles]

Do you mean there would be sufficient equity in the house to pay off your debts in full?

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

[flashingblade]

also, when we went into our IVA we had to sign a form saying our house could not be sold without our IPs permission. The land registery people were to be informed, is this standard?

[MelanieGiles]

Yes - the form allows your IP to be notified if there is any attempt to sell the property whilst the IVA is in place.

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

[Adam Davies]

Hi
It is standard if your IVA includes an equity release.What provision is there in your IVA for the house equity ?

Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

[flashingblade]

our house is worth 70 - 75 grand, we owe 41 grand in mortgage, 16 on secured loan, and whatever would be left, hopefully 10-15 on an IVA final settlement.
over the 5 years we would be paying 21000, so about 17-18 would be left after our first year, its something like 64p to the £1, we are paying now

[flashingblade]

im not sure about the equity relaease in our IVA, i know that in our 4th year we will probably have to remortgage

[MelanieGiles]

I am assuming that your original debts were in the region of £30,000? If so, creditors are unlikely to accept £18,000 now in full and final settlement, as they would get a lot more were you to continue to pay contributions.

Maybe this is your intention anyway, but I can't tell from the thread?

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

[flashingblade]

Yes thats right Melanie.

Our debts were around the 30k mark, and i just thought i might have an idea to get us debt free by selling the house, but we wanted peoples opinions first.

just read the agreement:
our creditors get 37% with our monthly contributions, but that will go up to 65% when we release 9k equity from our house in the 4th year, if we can

i can see now thats its not as straight forward as i had dreamt!

thanks anyway!