Hi we have been in an iva for 3 years now And are selling our house. our house is selling for 275,000 our iva started out as 24,000 our remaining mortgage is 70,000 and our new home is 100,000 now we have had nothing but problems with our iva because we keep getting told different things. First we got told that once we sell we will only be paying what we owe plus fees and the outstanding balance will be ours. But now we are half way through the sale and we have a letter from our solicitor to say the iva wants all of the money left. I would ring our iva but everytime we do we either can't get through or we get told different things. This is really stressing us out as we both lost our jobs so decided to move closer to family in wales as we live in London now but we need to live off the rest of the money untill we get jobs and can't move with out it. I'm really sorry if I'm not making sense I'm just very stressed out at the moment please can someone help to explain what actually happens. Thank you x
During an IVA you always owe the full amount of the original debt, plus fees and statutory interest at 8% per annum. It is common practice in a house sale during the IVA for the IP to request the total proceeds of the sale (less 15% equity) so that they can calculate the exact sum to be deducted and return the balance ( if any) to you.
The horse has bolted now, but it would have been better to arrange a F&F, with a set, agreed, sum to be handed over before starting the sale, on the proviso of no agreement, no sale.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Ask your IP to send their completion figure to your solicitor as any secured charge holder would. Your solicitor can then pay them off and give you the balance. Your solicitor can even give the IP an undertaking to discharge the IVA from the sale proceeds and allow the restriction to be removed so demanding all the funds seem entirely unnecessary.
Demand to speak directly to your IP and if you cannot you should consider staring the complaints process. You should be able to email the IP directly so you have evidence.
The problem is that a variation agreement should have been reached with the creditors before you decided to sell the house.
As a result sufficient funds from the equity will have to be paid into the IVA unless and until the balance of the total debt, plus interest plus costs have been paid in full.
I very roughly calculate this at c£35k less whatever payments you have made to date.