www.iva.co.uk

My husband and I are considering an IVA. Due to the down turn in the property market we currently have very little equity in our own property. However a few years back my husband took on co-ownership of his Mothers house on which we have a small mortgage. Would this house be safe?

Hi and welocme.
As your husband co-owns a property with his mother, if he entered into an IVA he would probably at some point in the 4th year be required to release some of his share of the equity in that property.

If the property is not one in which you reside, but you have an interest in the equity, it is likely that creditors would want to see that equity removed at an early stage and used as part of their overall settlement. In a bankruptcy scenario, possession proceedings could ensue straight away, but if your husband's mother is elderly, this could prevent a sale within her lifetime.

Thank you both for answering.

My Mother in Law is registered disabled and not in good health with advanced emphasimia (spelling?). If there was any suggestion that they would sell her house at the beginning of an iva we would have to look at other options. If they were to look at releasing in the 4th year we would consider it as we would hope to have some capital in our own home and to have paid off a large chunk of the IVA.

My next query is as my husband is self employed his income varies from month to month. How would a repayment scheudule be worked out?

Once again thanks for your help.

Merlin

Hi
Your husbands income would be averaged out and hopefully your IP would allow some flexibility with payments to help with the ups and downs.
Your husband will need a face to face meeting with an IP before proceeding,use this opportunity to make sure that you are happy with all aspects of a possible equity release etc
Regards

You have nothing to lose by putting an IVA proposal forward, and can always withdraw your application if creditors do not agree with your treatment of the property.

It is probably better to now take professional advice from an insolvency practititioner experienced in dealing with self-employed cases.