www.iva.co.uk

Wondered if you could help me if I sold my property a short while after starting an iva would it be considered as satisfying the 4th year rule or would a greater amount of equity be expected.

Hi Jon, if you sell during the IVA the creditors will expect to get most of the equity as you will be disposing of an asset.

You could make a Full and Final offer in the terms that, if accepted, the IVA will close, if refused you will not sell the house and the IVA will continue.

if you have to good reason for selling
ie; you lost your job and can't keeping at your repayments to both home and iva. after your other bills. they may go for a f&f.
letting you keep enough for deposit and moving cost. talk with your ip

Thank you, I'd optimismistially hoped it would satisfy the equity clause and would continue payments for five years. Seems it's not to be that way.

had hoped the equity could be split I could use the money for a deposit.

I haven't started an iva yet just fact finding. I want to repay what I can but can't just sell up lose all the equity and be without a home

You could consider a one off payment IVA. Basically, through the IP, you approach your creditors and say " I am willing to make the ultimate sacrifice of selling my home to pay you as much as I can" and offer a suitable figure, after working out what you can afford after expenses, future deposit and moving costs, allowing a little space in case you don't get the full asking price.

I would suggest talking over this as a possibility, which the IP might or might not think is a good idea, as it will, of course, all depend on your whole set of circumstances as to the best way forward.

Do chat to a few firms, as they tend to work differently ( and not always in your favour). A look around the forum will throw up names and experiences.

Hi Jon If you haven't started an IVA yet then one could be proposed on the basis that you sell your house voluntarily and your share of the equity is used to do a f&f with creditors. If you have surplus income then in Bankruptcy you only have to pay contributions for 3 years, in which case the IVA could be written to match this or even let you retain your income. It may even be argued that creditors are still getting a better result without any contibutions in an IVA as the costs are so much lower - there is no Bankruptcy tax to pay for example. It really depends on the figures etc and what you want to do. Speak to a local IP in your area- most good ones will offer you an initial meeting for free.

You would struggle to find another mortgage even if creditors allowed you to retain the funds for a deposit so staying where you are may be better for you. At least you stay on the property ladder and when the IVA completes you can then then look at moving.