www.iva.co.uk

I am considering an IVA, however I have a question: I own a car on HP, and up to halfway through the term of the HP agreement, payments were made ok. I have slipped a couple of times since, up to now where I am about 4 months behind and avoiding phone calls. I have past the point in the agreement where they will take the car back for non-payment, so my question is would I have to sell the car as part of the IVA? It is not worth even half of what I still owe on it, and if I sold it, I would have to replace it with something else, but would I still have to give it back/ sell it?

Appreciate your advice, Thanks,

Paul

Depends,

How much the repayments are? As long as they are sensible compared to you income and proposal then as long as ou maintain the repayments you should be able to keep the vehicle as the vehicle by the sounds of it has no value to your creditors as you owe more than it is worth.

But you will have a post-IVA liability due to the HP company if there is a shortfall after the vehicle is sold, and you will need to get the HP company's permission to sell.

I am self employed, and as such although we hope the business will pick up later in the year, I can only pay myself the equivalent of £12,000 pa currently. On HP the repayments are £250 pcm. Would I be better in that case returning the car before the IVA, and having any shortfall become part of the IVA?
The payment on this is quite steep, and as is the way with HP by this point in the term, I have now paid way more than the car was worth when I bought it.
I have another car (older, not on HP), that I was due to sell for funds to help me out, but now I am considering an IVA, I'm wondering if it would be better to cut my losses so to speak (I guess that's what an IVA is all about), return the HP vehicle, and put the debt on the IVA; I would have thought that way I can get the extortionate interest and charges frozen, and a reasonable payment as part of an IVA. That would also mean I only end up paying part of the debt to discharge it (if I have read correctly in the info section). Advice appreciated, Thanks, Paul

If the car is surplus to requirements and you can manage without it, then it would seem sensible to negotiate the return of the vehicle to the HP company to ease your cashflow. Any shortfall could then be included in the IVA.

Hi Melanie,

Thanks for that, I just wanted to be sure I was planning correctly rather than getting myself into more mess. The car will be returned as soon as I have negotiated with the HP co. then. Thanks for your help.

paul

Paul ... just thinking ... if you need a vehicle for your work and have to return the current one you should be able to get a vehicle from one of the leasing companys that deal with people with poor credit history ... I've just had a new Astra delivered.

Debbie