www.iva.co.uk

My partner has an unblemished credit file. He bought a franchise in 2003 on a "pay as you go basis" but also gave a personal guarantee. He has paid off £77,000 of a £100,000 purchase but this has VAT on top of it. He has now been signed off work indefinitely due to ill health. He offered the franchisor the opportunity to buy the franchise which they were going to do but pulled out in the 11th hour. They knew whatever happened he would have to close the office. He has now basically given them the company back and they are still going after him for £42,000!! What can we do?

Welcome to the Forum nle,

Sorry to hear about your situation, Does you partner have any other debt than the £42,000? I ask this as it is not feasable to do an IVA with just one creditor, you would need at least 3. The best thing to do is to possibly go into negotiations yourself with this company. Could you provide what your monthly disposable income is (income minus general living expenses)?

Best Regards,
IVA Experts
http://www.iva-experts.co.uk/

This is his only debt, a personal guarantee. He has been signed off work indefinitely and is on income support and incapacity benefit.

They are threatening him with bankruptcy.

It would seem that in this case nle that bankruptcy may be the best option, does your partner have any gross assets like a house which may have equity etc?

Bankruptcy should be carefully considered, however it does have alot of benefits, such as:
- your debt is handled by the court
- your debts get legally written off
- you can discharged from being bankrupt in 12months or less
- No other amount needs to be paid (except for bankruptcy fee of £485). Usually for an individual who had disposable income would potentially pay that for up to 3 years.

Best Regards,
IVA Experts
http://www.iva-experts.co.uk/

ivaexperts, should point out that only a percentage of the disposable income would be paid for up to 3 years.

He has a motorbike but will be using this for work and he has a car on finance, of which I am the guarantor, so I'll have to pay for that wont I?

He wasnt held to a contract when he was offered the franchise and basically was forced into signing the contract without being given legal advice, etc, books. He's a driver who was good at his job and I think the franchisor thought he'd skip off and open up his own agency. Now through ill-health and the promise of a buyer through the franchise who pulled out in the 11th hour and surprise, surprise is now running the operation, he has to pay the price. They have the database, clients, drivers, etc. What more do they want?

Let them make him bankrupt if that is what they feel is the right thing to do. This will save him a bankruptcy fee - and incur more cost for the heartless creditor.

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

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

Thanks Melanie, all his credit cards are up to date and his credit rating at the moment is 999/1000. Can he just go bankrupt for the amount that Driver Hire are asking him for or does this go against him on all of his credit?

Thank you so much for your help so far.

Nikki

Hi nle
If s creditor make you bankrupt it affects all your creditors.
Do own your own home, if so what is the equity in the property? Were there any assets in the business?

Dave Beech
http://www.adcrofthilton.co.uk

Really, well he should be ok then as he doesnt owe any other money. He doesnt own a home and has no assets, apart from his bike. He was really taken to the cleaners over the business. The franchisor of the company has basically taken over the running of the business which they were going to buy for a month ago but pulled out at the 11th hour and now the same person is running it. They knew my partner needed out because of ill-health so why pay for a franchise when you can take it over for free!!!

I own our home, it does have equity in it but I dont earn enough to borrow any more against my home.

As you say that you own the property - can I ask how long you have been married and whether your husband has contributed anything towards the mortgage or its upkeep/ If so, he may have developed a beneficial interest in the property which a Trustee in bankruptcy may pursue. How much equity do you currently have in the 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

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

We're not married!! I pay for the mortgage and all the outgoings, always have. He looks after the dog and the shopping.

I've always been of the opinion that I do not want a contribution from him as the mortgage and outgoings are my responsibility.

Is this ok?

How long have you lived together as a couple? And what equity do you currently have in the property? Do you have any children?

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

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

We've lived together as a couple for 9 years on and off, approximately £150,000 equity and no children. I cannot borrow any more on the house and to be quite honest, I don't want to.

Help ...

I think that a Trustee would claim that your partner has developed a beneficial interest in the property - especially as you have so much equity. They of course would have to be able to prove a valid claim.

There is some risk to you therefore in bankrutpcy, but you may decide to wait and see the outcome of this rather than borrowing more money against 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

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp