www.iva.co.uk

Hi everyone, this is a very good website. I have debts of 22k + I have a car on hp. I have to give them £11k to pay the car off (which I can do) but that would leave me with nothing left to service my debts. my flat has about 25-30k in equity. I have tried to remortgage but I cant get a new mortgage, because my new job (I was made rdundant last year) only pays 17k a year. Would the equity in my flat stop me going into an IVA?

Hi David

and welcome to the forum.

Equity - or none as the case may be - in a property is not a barrier from entering into an IVA.

The key things to look are are :-

1. Are you unable to meet the normal monthly payments

2. Do you have disposable income left each month AFTER your key household & living expenses are taken care of

3. Are you motivated to resolve your debt issue .

If the answer to the above is yes you should certainly review the possibility of an IVA. You can either review IVA companies on IVA.com or alternatively you can speak directly to one of the highly respected IP's here on the site. Click onto the Experts tab and have a look.

Incidentally where does the £11k come from to clear the car HP?

If you have money in a lump sum then you may be able to look at alternatives - either way an IP will be able to give solid advice in the first instance.

If your equity is more than you actually owe to creditors, then an IVA is unlikely to be am option which would be acceptable to creditors. Have you considered selling the property and using the proceeds to offer a full and final settlement to creditors?

Hi and welcome
If your share of the equity is more than your unsecured debts then yes it can prevent you from entering into an IVA.
If you have 11k available you should really consider using this to reduce your creditor debts and bringing them down to an affordable level.
Regards

I have 11k in savings from my redundancy. But I've been using that to pay the monthly payments. the car alone is £277 a month - and i will have to hand it back or find another 6k in 28 months time.

Hi Melanie, I could sell my flat(which I really love) but then I would have to rent somewhere. Rents are about £700 a month, my mortgage is £433 (fixed until Dec 2010) my takehome pay is £1060 a month! i would be left with £360 to pay food, utilities, council tax etc.

Not much of a life

Hi
Well keep hold of your flat for now,makes sense.
What about giving up the car and purchasing a cheaper one out right ? This would save you £277 per month.You could look at a DMP if you are finding the contractual payments too much to handle
Regards

Hi Andy.
I would love to get rid of the car, but according to the agreement I would have to give them £11k + the car back.

Hi
Have a look into this,at the worst you could hand the car back and the shortfall could fall into the DMP[or IVA if this proves to be an option]
Regards

Also check that the car is actually financed under a hire purchase agreement. A lot of people think, or were told, that they were getting a HP agreement, whereas in reality the loan is unsecured in which case it could be included in either an INA or DMP and the car therefore retained as well.
.

What we need is your exact details of what you owe and to who listed separately. Then what your current DI is. Then specific details as to what kind of car finance agreement you have. We can then give you the appropriate advice.