www.iva.co.uk

Hi, have a friend who has 18 months left on his IVA, he was made redundant last december, he has now 3 months behind on his payments, and informed is IP he will not be able to pay anymore has he is unemployed, what is likely to happen from this point, he does have a mortgage but this was not part of the IVA, will they make him bankcrupt ? or will they make him sell his house which i believe has a secured loan on it and not much equity. many thanks .

Has your friend asked for a payment break - I believe some IP's will sanction this to see if employment can be gained. Some payment breaks can be for 6 months.

If the IVA fails, BR is an option. In reality your friend would be back to square one with creditors chasing him -they could put a charge on his property too.

Did he receive any redundancy money - and payment breaks of up to 12 months can be negotiated for the right reasons.

hi all
yes he did get redundancy pay, but used it to live off, he has not really paid that much into his IVA since last december when he was made redundant, he has used his paymrnt breaks in the past i think 3, IP has told him he has until 17 of this month to pay what he owe's them, or they will go to creditors and they might just freeze it or file for bankruptcy, i think he still owe's around £9000, like i said his house was not part of the IVA , but could they still use what equity he has in it and force him to sell .

many thanks.

If the IP can't hold off any further, the IVA will either fail or need to have variation proposed and agreed by creditors.

If there is equity in the property which he'd wan't to use instead of IVA failing, he could try to negotiate with that as in the event of BR, the OR or Trustee would look to realise this anyway.

Best for his IP to establish the aims and list the options

I would suggest that the IP applies for a 12 month payment break to creditors, which obviously can be reduced if he gets a job in the meantime.

Bankruptcy will affect the property if there is any equity, and at least this gives your friend a little breathing space.