Hi Andy. The car is not necessarily going to be taken from you in an IVA particularly if a reasonable vehicle is required for work purposes. Even if you raised £7k for it to give creditors and leased one at £200 per month there would be an overall loss to creditors of £5000 [60x£200 less £7k]. There are other options such as selling the car to the company and using it as a company vehicle but given it is only worth £7k I would not be too concerned about it.
It is unlikely that a car of that value would be affected in an IVA - as it does need to last you for the next five years. If you did sell the car prior to the IVA, would you be suggesting that the money realised would be offered as an initial lump sum?
When you say the bills what do you mean exactly? If you mean paying creditors it would be pointless as you would lose the car and be no further forward. It would be better to not pay creditors at all and keep the car. If you mean to put the money into the company to keep it afloat this is entirely different and raises other problems.
The lease would not be too much of an issue as I assume it would be in the company name with you possibly as guarantor. It would affect the profitability of the company though and this would impact on whatever dividends you were being paid.
There are a number of issues that would need clarified but I think realistically that you should keep the car and speak to an IP as soon as possible.
My situation is a bit complicated because of the way my money is earned. I have periods of high earnings when I have a contract and zero for months on end when there is no work (now).
What I'm trying to do is sell the car and use some of the proceeds to pay the 3 month advance payment on a lease car. The rest will go into my bank account to cover future mortgage payments and a new central heating boiler (why do these thing break at the worst possible time).
I would hope the IVA wouldn't just take all the available money in my account due to my work pattern (I need money in the bank to get me through the periods with no earnings)
No point in selling the car to your company as you would be penalised on tax.
I am sure after you speak to an IP what you need to do pre- entering into an IVA appears reasonable. But it must be handled with care after full disclosure of all material facts.
I would also before making any final decision on your chosen IP to have a chat with another one for good measure.
Visit www.iva.com for reviews on recommended firms. Good luck and let us know how you get on.
Regards, David Mond, Insolvency Practitioner for over 46 years. Personal Insolvency Practitioner of the year 2012, Personal Insolvency Practitioner of the year finalist 2013 & 2014 awarded by Insolvency & Rescue Magazine and 2015 finalist for Personal Insolvency Firm of the Year.