Hi. In an IVA that took 13 months of pre-proposal

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maradona10
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by maradona10 » Mon Jan 25, 2010 8:41 am
Hi. In an IVA that took 13 months of pre-proposal negotiations by Grant Thornton with my creditors until it was finally approved in October 2008. There are some joint debts in the IVA so these creditors are liable to get a dividend from me as well as my wife being liable to making full payments as she is jointly/severable liable. This was fine for a while, however, my income has reduced dramatically over last 12 months and I'm awaiting the outcome of my variation meeting this wedenesday (27th) and my wife's circumstances have changed in that she has been supporting us and is now struggling to service her own and the joint debts.
1. As they are already incorporated into my IVA, what are the issues for our joint debts if she went for her own IVA?
2. What would be the chances/issues of a joint IVA for all of our separate and joint debts bearing in mind I'm already in an IVA (albeit a failing one!)?
Have got more questions bubbling under, but if someone could give me the low-down on these two issues first, I'd be so grateful.
Cheers.

 

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Shining
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by Shining » Mon Jan 25, 2010 9:23 am
Hi alph, I'm not sure of the answers to your questions but do know a professional poster will be along very soon to advise.

I would have a chat with your IP maybe or your wife can contact an IP of her choice, maybe take a look at www.iva.com for a list of companies and some reviews of these.

Is bankruptcy an option if you're both struggling due to a reduction in income?

 

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Darkdog
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by Darkdog » Mon Jan 25, 2010 9:34 am
Hi APH7,
I don't think you can get a joint IVA but could possibly get an interlocking IVA between you. You really need to to speak to your excisting IP as they have all your details and of course take the advice of the experts who post here

 

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Michael Peoples
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by Michael Peoples » Mon Jan 25, 2010 11:46 am
Your wife is liable for the full amount owing on any joint debts although the liability decreases as the IVA makes payments. If she enters an IVA of her own the full amount of the joint debts would be listed plus any personal liabilities. The joint creditors would get a dividend from each IVA up to a maximum of 100p in the £.

Your wife should seek some advice because as Darkdog says there are no joint IVAs. She could propose one in her own right and hopefully your own IVA can continuw albeit in a varied form.

 

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Alph
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by Alph » Mon Jan 25, 2010 3:13 pm
Thanks for your responses all.
Could I ask, should my variation request be rejected, I believe the creditors can go for 'second resolution'. Can anyone confirm what this is?
Also, if it fails and my wife decides to propose an IVA for her debts, can mine be re-proposed to inerlink with hers as everything will be based on our household income, I presume?

 

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Alph
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by Alph » Mon Jan 25, 2010 3:40 pm
PS Registered now and changed name to Alph, just in case it doesn't tie up with my original question this am!!!

 

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Michael Peoples
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by Michael Peoples » Mon Jan 25, 2010 5:00 pm
If your variation is rejected creditors could pass a resolution to fail your IVA or to make you bankrupt. If this happens you could propose a new proposal interlinked with your wife but there should be no difference anyway. Single IVAs or interlocking should always take into account the family income and the liabilities of the partner not entering an arrangement.

Hopefully your variation will be approved and your wife can then propose her own.

 

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MelanieGiles
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by MelanieGiles » Mon Jan 25, 2010 7:51 pm
Your wife's IVA would have to be independent of your own and could not interlock with one which has already been accepted.

 

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Alph
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by Alph » Tue Jan 26, 2010 10:39 am
Thanks for your replies Michael and Mel.
Another question, if that's ok?
We have negative equity in our property, therefore, would this influence the creditors decision on my variation request? ie If they fail it and try to make me bankrupt what would be the point? Wouldn't that be biting their nose off to spite the face because there would be nothing for them to recoup...whereas, the IVA will give them a return, won't it?
Also, if it does fail, could reproposals be done to take account of current circumstances and the fact that my wife, whom we've been trying to shield from 'bad credit history', will be submitting her own IVA proposal?
Thanks, all. Wish I'd found this site when I started! seemed to be on my own with only my barking creditors for company whilst the 13 month pre-proposal negotiations with NRock were going on!

 

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Michael Peoples
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by Michael Peoples » Tue Jan 26, 2010 2:13 pm
It is unlikely that creditors will make you bankrupt but it is certainly an option for you to consider if they reject the variation. If rejected, you could resubmit with your wife but it is unlikely that creditors would accept a new proposal if they rejected the variation.

Your variation should include an allowance for your wife to pay her credit commitments and if creditors accept the variation your wife's IVA would be drafted on such a basis. It is important to show creditors a full domestic I&E and if creditors reject your variation she can still proceed with an IVA on her own whilst your surplus would be dealt with by the Official Receiver should you decide to petition.

Hopefully your variation will be approved tomorrow and your wife can then have her own proposal drafted and accepted.

 

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Alph
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by Alph » Tue Jan 26, 2010 2:29 pm
Thanks, Michael.
You mention the bankruptsy option might be one for me to consider. My only concern about this is moving out! Are there ever any circumstances where the house would not have to be sold? eg we have negative equity, as already stated, and we have an 18-month old child, etc - or would they just give us longer living there before making us sell in order to build up some equity?
Sorry to go on!!

 

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Shining
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by Shining » Tue Jan 26, 2010 2:44 pm
Alph, take a look at Skippy and Julie's blog they are very informative in respect of Bankruptcy.

 

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Michael Peoples
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by Michael Peoples » Tue Jan 26, 2010 3:36 pm
Provided the property is properly dealt with at the time of the bankruptcy there is nothing to be concerned about. You do not own the property it belongs to the mortgage company. If you go bankrupt a third party can buy out your interest in the property for the value of the equity and where there is none £1 plus costs is sufficient.

No one can come back in the future and put you out once this interest has been bought so you have little to fear from bankrupcty.

 

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Alph
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by Alph » Tue Jan 26, 2010 4:02 pm
Hi Michael. That's really interesting news. Is it possible that my wife could be the third party even if she's currently a joint-owner?
Also, is this something my existing IP would deal with or can another IP get involved? Is it something you/your firm deal with?

 

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kallis3
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by kallis3 » Tue Jan 26, 2010 4:25 pm
If your wife isn't bankrupt then she can buy out the BI.

It's normally the Official Receiver who deals with that once the BR has gone through.
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