hi hope some 1 can help ive been in an iva for 15 months. In 2006 i purchased 2 flats off
plan that were finished in 2010 i failed to complete and lost my deposits i informed the company that i was in an iva however they told me that they were not in a position to disscus until they could sell the flats and crystalise there losses . in july i reiceved letters from there solicitor requesting Â£55,000 i passed these onto my ip who told me i was safe from any court action whilst in the iva ,the ip wrote to them asking them for a proof of debt and informed me that he would have to call a variation meeting whitch may cause it to fail. this was in july they have not responded . My ip has also warned me that it is possible that they could pop up at any time during the term of the iva and force it to fail especially in say 3 years time when i have more equity in my house whitch does not form part of the iva IE no remortgage pls help if possible open to any suggestions thanks k
Was your IP ware of these potenyial shortfalls prior to the IVA ?
They certainly could result in your IVA failing because of the amounts involved. How much equity do you have in your house at the moment ?
hello I have about 30k equity the ip did not know about it until i had something in writing .
he says that they must be bound by the terms anyway
i just dont want to pay the iva for nothing only for it to fail at the 11th hour . it seems im in limbo
any ideas ???????? thanks keith
Hope you get this sorted. If you have £30k equity and no equity clause in your IVA, could you propose a variation to include the new debt and your equity? This is just guess work tho and you ip (rather than a caseworker) will need to advise you on this one.
They will be bound under the terms of the IVA - but what a shame that your IP did not provide for these potential debts when your IVA was drafted. This sort of thing should always be considered by the professionals where investment properties are concerned, and the mortgage companies should have been circulated at the time the proposals were being presented, or else they simply have not done their job properly.
In cases like this we would list the mortgage companies for an estimate but also ensure that creditors do not insert a minimum dividend requirement. This at least protects the IVA and the client and avoids the need for variations.
Many shortfalls to investment properties take time to crystallize as some lenders appoint receivers to administer the properties until such times as they can be sold. It would be unfair for an IVA to be failed years down the line because of a situation like this.
Hi. Thanks for your advice. Is there anything I can do to help protect myself ?
They were informed of the iva at the time of the proposal. I agree it is totally unreasonable for them to ruin the iva at the later stages. Would this be upto a judge ? Thanks. K. Can u help with legal matters ?
It will depend on the terms of the IVA and what if any minimum dividend was demanded. It will also depend of the terms and conditions as it can be deemed a breach if the final figure for the liabilities exceeds the estimated amount by more than 10%.
Your own IP is really the only place to go at the moment because they will have full facts of the case. However, it sounds like the properties have been sold which would explain the £55,000 demand so a variation would need to be urgently called.
If the investment properties were not listed for a shortfall, the difvidend to creditors will drop substantially and the other creditors could ask for it to be failed. However, they are more likely to want to see how you propose to address the dividend drop so a sixth year extension or voluntary equity release should be acceptable. The quicker the variation is called the better.
I always demonstrate in my client's proposals what the effect of an increased claim from a secured creditor shortfall may have on the IVA dividend - usually in bands of £5k. In this way, they cannot argue that they were not given the chance to take part, nor aware of the effect of the increased claims.