What Should we do?

[gaffers]

Hi,
I wonder if anyone can give us some advice. Here is our situation. We have 3 credit cards totalling approx £27500 we also have a secured loan of approx £35000. Not taking the secured loan into account there is approx £20000-£25000 equity in our house. We have had the house on the market for the past 6 months but no joy in selling. We are now expecting our 4th child and desperately need a bigger home. Our original plan was to sell the house and pay off the credit cards with the equity, transferring the secured loan to our next place. But as we are unable to sell and realy struggling to find the money to pay all the bills every month we have started looking into IVA's and even BR. If we were to go down the IVA route would this take just the credit cards into account or would it also take the secured loan? Also can we still sell our home and could we get a mortgage or let a property with an IVA over our heads? Any help would be gratefully received before I lose any more hair and sleep.

[worriedgirl]

As far as I am aware (but not an expert) an IVAis for unsecured lending only. Not sure about other issues. BR will take into account all lending if you give up your home within the BR if you do this it may be wise to find somewhere to rent 1st

[chris.g]

Hiya and welcome to the forum. Only unsecured debts can be included in an IVA so you would still have your secured loan on the property. Any selling of the property would have to be ok'd by your IP as it would probably effect the payments into the IVA,
xx

[MelanieGiles]

The other posters are quite correct, and given the level of equity in your property it seems a shame to enter into a formal form of insolvency proceeding when you could substantially reduce those debts if the property were to sell.

If the property has been on the market for some time, with no interest, I would have a work with your estate agent to see if the price ought to be dropped or whether they can give you a revised valuation for a quick sale - ie in a three month period. If this susbtantially reduces the equity, then it might be worth looking at an IVA at that stage or even bankruptcy proceedings depending on how you see your budget post-move.