failing iva

[ashbash]

'm in my fourth year of my iva, and have had an erratic time of it,having had to suspend payments a couple of years ago for a few months, changing jobs etc, and now in deep do-do.

I was made redundant in April, and have found it very difficult to get the kind of work I was doing; I'm a mental health nurse/addictions counsellor and with cut-backs and such like I have not been able even to get much agency work, and have failed to get posts I applied for. I am looking to get lower paid work asap inany form to get back on track.

I have suspended both iva payments(£350) and my mortgage, and am trying to find a sensible way out of my mess.I am 50 years old, have about £40,000 equity in my flat, which I think could cover the agreed sum of my iva. Do I sell up and start from scratch with no debts but an obviously impaired credit rating, or try to re-mortgage (would anyone self-certificate me now?).

I have also been approached by Jefferson Hobbs who offer a service to get people out of their iva's, though my own I.P. also offer a re-financing service.Any thoughts/ experience of Jefferson Hobbs, or what realistic options could be
many thanks
Ashbash

[Oliver]

I think the best thing you can do is discuss these options with your IP.

I don't think it would be wise to seek a mortgage which you won't necessarily be able to pay as this could land you in more trouble.

Selling your house and offering the proceeds to your creditors is an option but it is important that you discuss this at length with your IP to see if they feel that it is a reasonable proposal.

Bankruptcy is certainly an option but you would undoubtedly lose your house through this.


Best Regards
Oliver

Thomas Charles and Co Ltd.
Experts in personal debt solutions.
Read customer feedback at: www.thomascharles.com/about_us.asp

[ray_a]

I founf Jefferson Hobbs to be very helpful but basically they deal with remortgages for people like us!

Suggest you have a chat with your Supervisor as I am sure something can be done!

[jamesfalla]

I agree with Olly that it is most unwise to re-mortgage your property if you have no income to support your current mortgage payments let alone any larger ones.

Selling your property, settling your IVA and starting again seems a harsh but sensible option. You must discuss your otions with your supervisor

James Falla

Expert in IVA, Bankruptcy and informal Debt Management solutions for over 10 years.

For more information visit www.jamesfalla.com and visit my blog at: http://jamesfalla.blogs.iva.co.uk

[MelanieGiles]

Seek advice from your own IP - they are experts in your own particular case, will know the creditors' requirements and can suggest a way out for you. Is your current mortgage on a repayment basis? If so, you could look at switching to interest only to save money.

I think that selling your flat and moving into rented accomodation is possibly the best solution. Your IP can then ask the creditors for you to retain a sum of money sufficient to meet your relocation costs and first few months rental unti you get back on your feet, and you will have no debts to worry about.

Good luck

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

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[Adrian Ratcliffe]

Hi ashbash,
The self-cert route for sub-prime goes like this, you have to have paid your last 6 months IVA payments in full to qualify.
Also you must have not missed more than 3 mortgage payments over the last 12 months.
By changing jobs one of the other fundamental rules is 3 and 3.
3 YEARS at the same address, 3 YEARS same employer (most will accept 1 year in employment at the same company) general rule of thumb for most lenders.
The FSA are clamping down heavily on the self-cert route because it has been abused.
Always pay your mortgage when you have equity in property or agree to pay what you can, most courts will not enforce possession.
Interest only mortgages are a short term fix .
Regards
Adrian

[ashbash]

Thank you for your information and advice. I will most probably go down the route of selling my flat ; if I have more in equity than the 40p in the pound agreed repayment, do I get to keep it, or does everything go in the pot, no matter what I have already paid?
cheers

[Oliver]

You may be able to keep a portion of the funds to finance a deposit for the new rental property but you almost certainly have to pay anything above this to your creditors. Contact your IP to confirm this.

Best Regards
Oliver

Thomas Charles and Co Ltd.
Experts in personal debt solutions.
Read customer feedback at: www.thomascharles.com/about_us.asp

[ray_a]

Hi Ash

My wife and I were in the same situation.

We are in the process of selling infact exchanging contracts if our buyer can be bothered but that is another story!

Basically the problem lies with what your IVA states and that is where the catch comes in and we as a group need to watch out for this.

You may well find that there will be greater funds to cover the debts in which case you will have to pay a 100p in the pond to your creditors. Well that may not be to bad but then there might be a statutory interest charge at 8%. This has happened to me and where I found this site.

Perhaps you could look at your IVA and come up with some answers and then we can help you decide which is the best option.

Sorry but this is where it gets complicated and hopefully not to frightening.

Also you need to sort out where you are going to live and how you can deal with this.

If you rent you might need to make a six month deposit and the normal 1.5 months deposit for renovations, etc!

Do come back

Good Luck

Ray

[ashbash]

Curses! oh well, time to set it all in motion....thanks again

[ashbash]

Hi Ray
thanks for your info, yes it does seem that all will have to go to the creditors as far as I can see.

I'm lucky in that my girlfriend has offered to put me up and it is also an opportunity to review what I want to do with the rest of my life. I'm not that wild about returning to nursing/addictions work, in fact am fairly burnt-out by it all, and you need to be at least a little bit keen to do it properly!

So, back to square one with lessons learnt and maybe a new career as an artist..which is what I always really wanted to do anyway, but felt I wasn't 'allowed' to whilst my parents were alive. Funny how we tie ourselves up sometimes, isn't it?
Thanks again
Ash

[ray_a]

Hi Ash

Do keep in touch because I am trying to sort out the statutory interest angle so it could be useful to work together on this issue!

Regards

Ray