www.iva.co.uk

I had a call from the mortgage company couple of weeks ago asking if i agree to the vaulentry repossesion.
????
I thought the property was handed over to my ex partner and the court order was for her to surrender my share of the equity for the IVA. I did not know I was still on the mortgage i told them but apprently i was.

I have 2 years left of my IVA
The Halifax sent me a form to sign for the vaulentry re possesion.

I want nothing to do with the property, it holds too many bad memorys

I sent the halifax form back and then called my IP to inform them what has happened.
I just assumed being in an IVA that if they was any shortfall in the sale or auction of the re possesion that it would be included as part of the IVA and i will still be debt free in 2 years.

However, I have now found out that this would not be included in the IVA as the mortgage was defaulted on after the IVA was taken out.
My IP also said that the re possesion could also take couple years in which case my iva would have completed and then just as when i think i am debt free the halifax would come knocking for their shortfall.

Is this correct?
will the shortfall not be included in the IVA ?

Would bankruptcy be an option?
I just dont want any more debt, Just as i think life is getting better this happens.

as a very last resort I could just manage to scrimp together the mortgage payments should they allow me to take possesion of the house back. But this is a last resort.
Like i say this house holds bad memorys and i thought i had got rid of it by giving it my ex wife. obviously she refuses to take it into her soul name because then she would be lone person resposible for the shortfall.

desperate advise needed.

Thank you

Hi
I think that your IP may be correct on this point.
Did you advise your IP at the start of the IVA process that you had an interest in a property ?
Regards

Hi Andy,

I left my partner - (now divorced)
I told her she can have the house and we will split the equity when and should she ever sell it.
I took resposibility of the credit debt of 35k
which i entered into the IVA
When i took out the IVA my IP knew about the property and 13k of equity was going to be released in the 4th year.

My ex wife had the house on the market for the past year but apprently has also not kept up the payments and so is now being re-possed.

I disagree. The mortgage debt was a debt that existed at the time the IVA was entered into and is therefore bound. Hopefully your IP would have notified the mortgage company at the time of your creditors meeting - but in any case they must take notice of the shortfall now.

If your IVA were to be closed before the shortfall came to light, then you would be responsible for paying the equivalent dividend that your other creditors received in the IVA to the mortage company.

This sounds like an IVA which will eventually need a variation once the extent of the shortfall is better known.

MelanieGiles wrote:

I disagree. The mortgage debt was a debt that existed at the time the IVA was entered into and is therefore bound.

Sorry, I am confused now,

Their was no mortgage debt at the time i took out the IVA

Hi
There was 13k equity at the time of the IVA so now that there is a shortfall can it really be added to the IVA Mel ?
Regards

Just to help if it makes things clearer.
The mortgage was only 54k
Value of property is 80K (not in a very desirable area)
Equity = 26k
I left and had 35k of debt.
Started IVA and my share of the 26k equity (13k)was to be used towards the IVA in the fourth year.

after 3 years i suddenly find the ex had fallen behind payments and now is going through repossesion.

The arrears on the mortgage is now 3k
I presume after repossesion and auction they will then be a shortfall.
Why will this be included in the IVA ?
I wish it would but i can not see how or why.

I spoke to the Halifax and they said it is in my interest to save the property if i can because if their was any shortfall when they sell the property it does not matter if i am in an iva or not, I will still be accountable for the shortfall.

Yes Andy - a debt is a debt, and the only thing different with a mortgage is that it is secured against an asset which can go up or down in value. The value of the security simply reduces the debt, but it doesn't negate the fact that it was a debt in the first place.

Hi
That is interesting and reassuring for UKMBD.
Wonder why their own IP has said that it will not be included ?
Regards

Hmm, OK I will have to ring my IP again tomorrow. and get confirmation.

Strange why both my IP and the Halifax say it would not be covered though.

But thanks for your advise

I am not sure why they should think that ukmdb. Any shortfall dates back to when the IVA was taken out - notwithstanding that at that time there was expected to be a surplus.

Who is your IP?

Hi David,
Well I spoke to my IP Blair Endersby
and I got through to someone in Property who was amazingly helpfull
Any shortfall will be included in the IVA
they may have to do a variation like what was suggestered and the term may have to be increased.

WOW I feel so much better.
I think my mistake was speaking to someone just in the call center and not from the legal property department.

Thanks Guys.

Hi
That really sums up the problem that can occur when dealing with larger companies, it is a good job that you questioned it and a good job that Mel was at hand to give the correct answer.
Regards