can i simply go bankrupt after one year into IVA

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jake.sd

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Post by jake.sd » Sun May 16, 2010 2:29 pm
can i simply go bankrupt after one year into an iva,not missed any payments no equity in home.(interest only mortgage)
so why not ?
i believe they make me re mortgage anyhow and take the profit at end of iva
 
 

Julie

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Post by Julie » Sun May 16, 2010 2:35 pm
Hi Jake,

If you want to go BR, then there's nothing stopping you from letting your IVA fail and applying to the courts for BR.

Your credit rating will be shot for 6 years from the start of your BR order, assuming the judge accepts your application. You will also have to declare that youe are BR if asked by employers, banks etc.

Why do you want to go BR if your IVA is running smoothly?
 
 

MelanieGiles

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Post by MelanieGiles » Sun May 16, 2010 2:43 pm
You may find it difficult to persuade a judge to make a bankruptcy order when you appear to be in a perfectly good payment arrangement which you appear to be affording.

Why would you now want to go bankrupt after paying your IVA for a year? And surely the equity release provisions were well discussed with you prior to the proposals being put forward.
Regards, Melanie Giles, Insolvency Practitioner
 
 

The Major

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Post by The Major » Sun May 16, 2010 3:40 pm
There is nothing to stop you going bankrupt the Judge or anyone else cannot make you pay into an IVA that you do not want to be in.
 
 

Skippy

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Post by Skippy » Sun May 16, 2010 3:57 pm
I'm pretty sure that the judge can refuse to make a person already in an IVA BR on these grounds, the same as they can refuse to make a BR order if an IVA would be a better option.

I also can't understand why someone who can afford an IVA would want to go BR, especially after paying into the IVA for a year. While BR isn't as bad as people think, it's a serious decision and does have major implications.
 
 

Julie

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Post by Julie » Sun May 16, 2010 4:00 pm
You are correct Major, but Jake should not assume a BR application will be approved if he allows the IVA to fail
 
 

kallis3

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Post by kallis3 » Sun May 16, 2010 4:03 pm
I agree with Melanie. If your IVA is going ok, then why not continue with it.

If you do go bankrupt, then you will have to let your IVA fail first. You may very well find that you have to pay into an IPA for three years.

If you are having problems wih your IVA, then your IP is the first port of call.

I do agree with Mel, if you can afford to pay an IVA, then you should continue with it.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley.
http://kallis3.blogs.iva.co.uk
 
 

MelanieGiles

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Post by MelanieGiles » Sun May 16, 2010 4:11 pm
I am afraid that there is something to stop people going bankrupt The Major. It is called the District Judge who may determine not to make an order. If this happened, how would you suggest that the debtor get themself made bankrupt?
Regards, Melanie Giles, Insolvency Practitioner
 
 

Julie

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Post by Julie » Sun May 16, 2010 4:15 pm
Hubby had to explain why his IVA had failed and name who he had taken advice from, before a BR order was approved.
 
 

Skippy

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Post by Skippy » Sun May 16, 2010 6:12 pm
I had to do the same Julie. The judge wasn't happy when I said that I'd taken advice from my IP, he wanted me to have taken independent advice. Luckily I could say that I'd had advice from Melanie through the forum!
 
 

RHB

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Post by RHB » Sun May 16, 2010 6:55 pm
Bear in mind also that the OR has 3 years to realise any equity in your home. You may have none now but situations can change.
 
 

kallis3

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Post by kallis3 » Sun May 16, 2010 7:18 pm
I would take advice from the IP in the first instance.

If you have problems, then go via them initially.

Why would you want to change things now?
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley.
http://kallis3.blogs.iva.co.uk
 
 

The Major

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Post by The Major » Sun May 16, 2010 8:12 pm
Hi Skippy

If a person is in an IVA then he/she is presumed insolvent to be in that position, therefore a Judge cannot refuse the bankruptcy petition if that is what the debtor wants, if the IVA is current then rule 6.42 (2A) of the Insolvency rules 1986 state the supervisor is given 14 days notice of the hearing prior to the granting of the order, some Judges will grant this order anyway as they are already aware that the supervisor is powerless to stop it if that is what the debtor wants.

Secondly a person who petitions for bankruptcy but the Judge feels the IVA may be more appropiate, will normally come to this conclusion by simply examining the statement of affairs, it could be in the debtors interest especialy if there are substantial assetts, however if not the petitioner simply tells the Judge he/she does not want an IVA, an IVA is unenforceable.
 
 

Skippy

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Post by Skippy » Sun May 16, 2010 8:26 pm
Thank you for sharing your knowledge with me. However, when I went BR I was made aware that it was down to the District Judge to approve the BR order, and they were perfectly entitled to refuse it.
 
 

Julie

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Post by Julie » Sun May 16, 2010 8:30 pm
I agree Skip - having experienced the process of BR first hand, the judge can refuse a BR application.
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