Gifted equity of house sale and IVAs

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Carrera74

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Post by Carrera74 » Sat Jun 19, 2021 12:59 pm
Hi everyone

I have tried to apply for an IVA but it was turned down at the pre meeting stage as I sold my home to my daughter 2 years ago to enable me to get my now ex husband off the mortgage and to keep a roof over my head and my disabled son. I now rent the property from my daughter.

The IVA advisor said that the creditors said as my ex and myself had gifted the equity to her - this was the only way she would be able to get a mortgage that I am unable to get an IVA.

Is this right? Are there any other routes I can take? I am desperate to get my debts under control and had hoped this was my way out but now I feel I have no other option. I am terrified of what will happen next and have been ignoring the calls that have started up again and the letters are starting to come again now that the 30 days holds have been lifted.

I don't know what to do and can't stop crying and I'm not sleeping.

I thought selling the house was the right thing to do - the only option to keep some stability in my son's life but now I can't get out of this debt nightmare.

kallis3

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Post by kallis3 » Sat Jun 19, 2021 1:19 pm
How much are your debts? There are other avenues such as a Debt Management plan - you could speak to more than one IVA company and see if anyone else can help.
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

Carrera74

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Post by Carrera74 » Sat Jun 19, 2021 1:25 pm
My debt is a disgusting amount, £40K. Years of snowballing out of control but with 2 incomes we managed it but when I separated it became unmanageable and now years later it's completely out of control. The online debt advice forms said I could apply for IVA or Bankruptcy as the amount I owe is so large a DMP would never end. With hindsight I should have got legal financial advice before agreeing to keep the mortgage / the house but I just did what I thought was right. It's such a mess and I can't see a way out. I had everything pinned on the IVA and despite being upfront about everything before I started the process it was still declined at the pre meeting.

Foggy

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Post by Foggy » Sat Jun 19, 2021 1:51 pm
Transfer of a property at an undervalue can be seen by creditors as a device to artificially dispose of assets --- obviously this isn't the case everytime, but often enough to make them view this as suspicious. Had you gone for bankruptcy the Official Receiver could reverse the transaction to seize the asset for the benefit of creditors.

I would ask the IP if he could approach the dissenting creditors again with an offer to extend the IVA term by a year to compensate for the property issue -- in an IVA you agree to attempt to release equity towards the end of the term. In the event that you are unable to release this equity the IVA is extended by a year instead. So, this way, creditors would be getting what they most likely would have got anyway (as there is no guarantee that equity would have been able to be release -- I believe the majority of equity release provisions end up with the extension rather than the release).

If the firm you are speaking to at the moment will not try, then seek one that will. Who are you talking to now, if I might ask?
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk

Carrera74

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Post by Carrera74 » Sat Jun 19, 2021 2:00 pm
I have been dealing with Stepchange and the IVA side of it have transferred me back to the main debt advisors. It's been a really long drawn out process with me chasing it every week and the guy I had been speaking to whilst a pleasant young man didn't really seem to know what he was doing and was like the go between. I started the process back in January and finally got the outcome I did in May. And have been burying my head in the sand every since. I should know better!!

I'll give them a ring and see what they say if it's a possibility but I would have hoped he would have suggested that if so. In hindsight I should have just sold the property and rented somewhere not linked but did what I thought was the best thing at the time.

Foggy

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Post by Foggy » Sat Jun 19, 2021 2:12 pm
Whilst Stepchange are an excellent firm, with great creditor relations, they seem to have slipped a little lately and do not seem to have the expertise or, indeed, enthusiasm for IVA's that they once had. The problem is that they have so many clients and only a couple of IP's (who do not sully themselves with direct contact) and tend to shy away from anything out of the ordinary.

Personally I would seek out a small to medium sized firm where the IP is actually actively involved and applies his or her experience for the benefit of the consumer.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk

Carrera74

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Joined: Sat Jun 19, 2021 12:50 pm

Post by Carrera74 » Sat Jun 19, 2021 2:26 pm
Thank you for this. I'm looking through threads on here. I assumed best to go with Stepchange as didn't want to risk being ripped off and thought either them or Payplan. Time to do some indepth research before the calls start again on Monday!
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