shares and cars [assets]

[rickyg33]

Within the IVA framework, if a full and final settlement is sought, is it usual to add the value of shares and cars into the assets 'pot'?

We have shares valued currently at about £1,200 which we'd like to hang onto and cars, one of which I use for work and the other my wife uses that is worth about £2,500.

We can raise a decent amount [one which an advisor has indicated would probably be acceptable to our creditors] through remortgage and don't want the shares and cars touched. But what's to stop the creditors thinking "they can sell the shares and cars too and add this to the money pot"?

rickyg

[MelanieGiles]

Are you talking about making a full and final offer as part of the original IVA proposal, or a variation of an exising IVA?

From memory you are still considering your options, so assuming that you are wondering whether these assets ought to be declared then the answer is yes. It is usual for the cars to be specifically excluded from realisation on the grounds that they are needed for transport to and from work.

It would not be fair to expect to hang onto shares, at a time when you are presumably going to ask creditors to write off a large amount of their debt.

[rickyg33]

Welcome back from hols.

We are looking at raising enough money through remortgage to clear any debts in my wife's name, and leaving just me in the IVA. The reason for this is that the mortgage is 99% in her name [on the title deeds] and so effectively she's raising enough money to clear her debts [seeing as the equity is actually hers] and help me to come to an agreement with my creditors.

The shares are all in her name and so you'd think they wouldn't be included in my IVA details.

rickyg

[MelanieGiles]

Thanks Ricky!

If the shares are in your wife's name, they would definately not need to be declared in your IVA - and would be therefore safe.

[rickyg33]

Mel, do you think the idea of clearing her debts and her helping me to raise enough money to get an IVA 'full and final' agreed with my creditors is a suitable solution [of course you don't have the detail, but in principle?].

Have you come across this before?

rickyg

[MelanieGiles]

In principle, I think that it is an excellent idea, and have been involved in a number of proposals just like the one you are suggesting. It is a credit to your wife that she is prepared to raise money on her own property to assist you in clearing your debts, but do be aware that creditors will be suspicious of her owning so much of the property and this will need to be properly explained in the proposal by the IP you have chosen to represent you. In addition to this, if you have disposable income at present, your wife's offer will need to equate to at least the amount you would be able to pay into an IVA on a five-year basis.

[rickyg33]

The property was originally all in her name [her house when I met her] and the 99% - 1% split has been on the title deeds for some years now.

The total to be raised for a full and final offer will probably be over and above what our current disposable income could raise. We only have about £230 per month disposable [using the CCCS guidelines] which is £13,800 over 5 years. We think we can raise enough to clear her debts and about £25,000 for an offer to my creditors - which is about 31% excluding IP fees.

[MelanieGiles]

Is the £230 before or after you have taken account of the higher mortgage payments? An offer of 31p in the £, given your circumstances, would appear to be reasonable, but if I were advising your wife, I would suggest that she keeps her offer to the minimum as you have to pay that mortgage back over a much longer period than an IVA would run over.

[rickyg33]

the £230 is current [before] and it would be by using this disposable amount to increase the mortgage payments to release extra equity

[MelanieGiles]

Are you sure it is only going to cost you that much for such a higher mortgage? And do be careful to build in some leeway in case interest rates rise again.

[rickyg33]

we'd have to have a part interest/part repayment mortgage instead of the current all repayment mortgage to make the sums work

we'd then look at reverting the mortgage again in future, when we could afford to

[MelanieGiles]

Well you certainly sound as if you know what you are doing, so the very best of luck to you both.