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I have total debts of £218k which is made of secured loans being £98,700 (mortgage), £61,000 (2nd charge),an unsecured personal loan of £23,00, credit cards of £27,000 and a family debt to my parents of £8000. £80,000 of this debt I have inherited as my wifes business crashed last August. I have sought advice from an Insolvency Practitioner who has advised bankruptcy should I fail to re-mortgage my property to combine both secured loans. He has suggested an IVA re the un-secured. I am at the point at the moment with a financial person attempting to secure a remortgage but my question is, if all fails were do i stand with my property whic is currently valued at £210,000. If I downsized and purchased a smaller property releasing the £50,000 equity, would that be seen by the un-secured lenders of my intent to at last making an effort to resolve issues or would I loose my property with my wife and 3 children seeking to rent somewhere.

Hi
You have 160k secured debt and 50k of unsecured debt plus 8k owed to your parents.
If you remortgaged and then entered into an IVA for the remainder of your debt then you would be required to remortgage agin in the final year of your IVA to release equity into your IVA.
If you sold up now you could pay off the lions share of your unsecured debts and would certainly be a better option than bankruptcy
Regards

Andy Davie
IVA.co.uk Spokesperson and Website Manager

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

many thanks for your response, but i would like to clarify whether you are saying to sell and buy a smaller property or sell and rent another property ?

Hi
You could sell and go into rented without having to enter into any type of insolvency agreement with your creditors.
You could sell up and purchase a cheaper property and use the remaining funds to either pay off your debts down to an affordable level or use a lump sum for an IVA and ongoing monthly payments,however you may need to remortgage in the final year of the IVA.
The problem that you have is that your equity is almost as much as your unsecured debts and you are technically only just insolvent,to enter into an IVA you need to be insolvent.
Regards

Andy Davie
IVA.co.uk Spokesperson and Website Manager

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

That is good advice from Andy - and poor advice from your IP! Why would someone recommend bankruptcy proceedings to you when you have such a large amount of equity in your property!

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

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http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp