www.iva.co.uk

I have a mortgage of £89000 and a secured loan of £20000 on a property which is now worth about £95000 and still dropping. I also have other depts of about £1000. I earn a good salary of £40000 pa however because I have to work away from home I have travel and living expenses in London also. I just about manage but now fear redundancy, would I qualify for IVA with a mortgage and secured loan albeit is now in negative equity and if so how would it work. I could probably manage if I could do something about the £20000 loan from Tesco direct which costs me £274 pm, it appears to be rising! Thank you for reading this.

Hi and welcome.

If your unsecured debts are below £15,000 which it appears that they are, then an IVA won't be the solution for you, but you might be able to to a Debt Management Programme.

I advise that you speak to an Insolvency Practitioner as soon as possible so that they can go through your options with you. Visit www.iva.com for a list of companies.

hi helene and welcome to this wonderful place.
is it just the secured loan and the tesco loan you have.if so kal is right and a DMP may be a better solution-would you be able to post a breakdown of your current situation so we could help you [:)]

Hi Helene and welcome to the forum
For an iva you need at least 3 creditors and unsecured debts of 15k and above. On the face of it, it looks like you would not qualify but I would still have a word with a few company's to get advise. I'm sure I've seen it mentioned somewhere about secured debts being made unsecured as the property value is less than the debt. I could be wrong though!
I would recommend contacting Melanie Giles who will be able to give you expert advise.

The shortfall to the secured lender is treated as an unsecured loan, but an IVA is hardly suitable to deal with such a small debt and one linked to housing.

If you cannot afford to continue to live in this property, I suggest you think about selling and moving into cheaper rented accomodation - but you will need to find a way to service any residual shortfall from the house sale into the future - or consider whether bankruptcy proceedings may then be a better option.

Just to mention that debts as low as £12,500 can be an acceptable level for doing an IVA and we at *company name not allowed in posts* have done dozens that are within that range. Speak to an IP as soon as possible to discuss your precise circumstances and preferences - I am sure you will get free the appropriate advice. Good luck.

I was under the impression that it had to be £15,000 with at least three creditors or 2 creditors and three lines of credit.

That is only under the IVA protocol Jan, and there is no minimum debt level - only one which has been imposed by a lot of IP firms on commercial grounds - however I think a lot of IPs would not belive that at IVA was suitable to deal with a mortgage shortfall which has not yet been quantified and small debts of an aggregate $1,000.

Nothing wrong in putting it forward, however, and letting creditors be the ultimate decision makers.

I shall remember that. I know all the adverts you see on TV, and on the internet say £15,000. Do I take that the amount of creditors is the same though?

David Mond wrote:

Just to mention that debts as low as £12,500 can be an acceptable level for doing an IVA and my firm have done dozens that are within that range. Speak to an IP as soon as possible to discuss your precise circumstances and preferences - I am sure you will get free the appropriate advice. Good luck.

My firm has done cases where the total debt was under £10,000 and the case is still running. Obviously the Nominees fee was small at £500 and Supervisors fee was £300 per annum - creditors were quite happy to agree to it! It all depends on circumstances of each relevant case. In one or two deserving cases we have done for no fees at all.

It is good to see that IPs are accepting deserving cases at a lower level - one of the things I think it was sad that the SIVA project did not conclude.