www.iva.co.uk

I have just discovered that I am a 25% owner of my Grandmothers house. I have been in an IVA for 14 months and she died 18 months ago. My Aunt I presumed inherited everything from my grandmother but actually only inherited 50% of the house my late fathers share being split between me and my sister.
The house is worth around £100K so my share around £25K. Will I have to sell it and hand the cash over to the IVA people or could it be used to try and get an early settlement, it would be in the region of what we owe the IVA people over the 5 years.
Alternatively could I rent it out, pay the rental toward the IVA as an increase of income then at the end of my IVA own a share of a house.
I'm confused but need to know some more to be able to talk to my Aunt who still doesn't know that I've found out about the ownership situation (she had it on the market without my knowledge).

If its sold then the funds you receieve would be classed as a windfall and go into the IVA pot to increase the return for creditors.

If its not sold then you have an asset that creditors would expect to see realised for their benefit.

You always owe the FULL amount of your debts until the IVA completes and only then is any written off so what creditors expect to get over the term of the IVA is neither here nor there.

As for renting it out it may be possible but you would still be expected to release any equity in it for the benefit of creditors.

You really need to discuss this in full with your IVA company as they have intimate knowledge of your IVA.

Let us know how you get or or if there are any questions keep them coming.

Paul

It might be a bit hard to realise the value of this property if my Aunt and sister don't want to sell. I don't imagine anyone would want to buy a 25% share in a property.

I agree with Paul - you need to speak to your IP about this as soon as possible.

Thanks for both replies, I think I'll talk to them in the morning when I'm not at work and find out a plan of action, then all I need to do is speak to my Aunt and sister...

It may be that you have to extend the IVA payments by 12 months in lieu of the equity you own, however, I am not 100% sure and your IP is always best placed to advise.

Please post back when you have an answer as sometimes the IP's who post on here will have a different opinion on how to treat things and may be able to help further.

Hello and welcome. Technically, your share will be regarded as a windfall and will be payable into the IVA. Should they be so minded the creditors could force a sale.

You cannot use a sum of money the creditors are entitled to anyway as a settlement offer.

Under the terms of your IVA you are probably bound to disclose windfalls, failure to do so could fail your IVA, should the IP discover the omission at a later date. At annual review, and / or at final review you will be asked to sign a statement confirming that you have not aqcuired any assets during the IVA.

There is, however, ons straw to grab at ...... you actually acquired this asset prior to the IVA commencing, the fact that it was omitted at that time was because you had no knowledge, so there is a slim chance the IP could deal with it differently. However, you will need to discuss this with your IP.

Might I ask which company you are with, and how did you discover this inheritance ? The first part of the question is to see if your IP is known to us and we can comment on there helpfulness, the second is me being purely nosey

We're with Grant Thornton.
I didn't know about it until a council tax bill with my late father's name on was sent to my mum's house with my grandmother's address on. After a bit of digging I've confirmed the property has been held in trust until my grandmother's death. It's technically still in my father's name but as he died nearly 10 years ago it it split with me and my sister. I still have to have a conversation with my Aunt about it all. I'm cross as we might have avoided all this had I known about this asset before entering into my IVA.

You can contact Karol, who represents GT by email at ivacustomerservices@uk.gt.com and ensure that "IVA Forum" is all that is entered in the subject line of the email. She will be able to help.

This is indeed an interesting issue, and I cannot fault Foggy's good advices to you with regard to the treatment of the asset. Your share of the property does, however, fall to be dealt with under the terms of the IVA and will need to be disclosed to creditors.

Is it possible that your aunt and sister would be prepared to buy out your share of the property - perhaps for a lesser sum in order to provide them some benefit from the transaction?

Welcome to the forum - when you have had an opportunity to chat with both your aunt and sister do get in contact with us and we will be able to help you,

I look forward to hearing from you,

Kind Regards
Karol

Well I spoke to GT and they seemed to think if the house was sold that they could go to the creditors with a F&F offer. However they are could still just take the money and still keep us in an IVA for the full term and obviously get more pence per pound owed than they would if I hadn't had the money from the house sale. If the house is rented out for the remainder of the IVA then the rental income would go into the IVA pot but I could be left with the asset to sell afterwards.
The thing that annoys me is that if I had known this 18 months ago befor my IVA started then perhaps I could have made the creditors an offer and not ended up in this situation to start with.
I don't know what I'm going to do really until I can speak to my Aunt and sister but only having a 25% share I can't force a sale or equally stop it from being sold. I don't know if I can even make my Aunt rent it out or if it'll just stit empty for years to come...
Next I need to get proof that I actually own a share in the house so unless my Aunt is cooperative then it'll be solictors letters that I can't afford...

If the property is registered (which it should have been on change of ownership) you can get a copy of the Title from the Land Regisrty for a few quid. That will give you the ownership details.