Have just discovered that my partner's ex-Husband was granted an IVA

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jonboogaloo
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by jonboogaloo » Fri Sep 01, 2017 2:05 pm
Hi - Some advice and help please, complex situation so I hope I've provided enough information

Backgound:
My partner and her ex-Husband have a joint mortgage cira £138k
They have been separated since 2013 (living apart) but have not yet divorced and there is no financial order in place.
Have just discovered that the ex-Husband was granted an IVA in October 2015. There has been no communication from him about the plan nor any communication from any credit companies where a joint debt may have been held between my partner and her ex-Husband.
There are no Charges noted at HM Land Registry against the House (except expected for Mortgage)
The IVA IP is through Knightsbridge Insolvency (as confirmed through public record search for the IVA)

1. Is it possible to obtain more detail about the plan? For instance, if the house has been declared an asset and what other joint debts had been subject to the IVA?
2. If the house has been declared an asset how does that impact my partner and her Children. For instance, in 2019 (4 years after IVA set up if my understanding of these things is right) can the IP force the sale of the house to release equity toward the IVA?
3. Its very likely that the divorce will proceed 'with consent' however how does the affect the setting up of financial order? Ex Husband has previously been willing to consent to a Charge of no or at least very little interest in the property, with the property remaining in both names until such time as it can be remortgaged by partner and/or youngest child reaches 18 at which point if not remortgaged then sold so to remove his name from the mortgage. WIll the IVA effectively determine the Financial Order with respect to the House or can the Ex agree, say for argument, a 10% interest in equity and that Charge would be given priority?
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Foggy
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by Foggy » Fri Sep 01, 2017 2:15 pm
I am afraid that the ex's IP has no duty to discuss the IVA with your partner so you need to speak to the ex to see if he will discuss this with you both. It is usual for a charge to be placed on the house and it could be that, because of the situation, his creditors have agreed to treat it as an excluded asset (they sometimes do this and add 12 months to the IVA term instead). With regards to joint debts, your partner's ex will be absolved from them by virtue of his IVA and the full debt will fall to your partner to pay --- it could be argued, since she will effectively be paying "his half", that she is actually a creditor and would then be entitled to a copy of the proposal.

Regarding question 2 -- the IP cannot force a sale to release equity.
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Michael Peoples
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by Michael Peoples » Mon Sep 04, 2017 10:59 am
I agree with Foggy and would guess that the property has been excluded in exchange for an extra year's payments. However when the divorce is finalised your partner's ex will have to disclose the IVA to any judge before an order is made so the judge can take this into account.
jonboogaloo
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by jonboogaloo » Mon Sep 04, 2017 1:06 pm
Thank you for the responses.

In short summary:
As the HM Land Title search shows no Charges against the property, the property won't have been included in the IVA

In any case, the IP cannot force the sale of the property

In addition; for confirmation of how the property is handled my partner (who is joint owner of the mortgage) can write to the IP to confirm property was excluded.

thank you, I believe you've answered my question.
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Michael Peoples
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by Michael Peoples » Mon Sep 04, 2017 1:23 pm
When an IVA is approved there is usually a restriction placed against the property which has no value but is registered at Land Registry. It is possible that the IP did ask your partner's ex to sign the restriction but unless all borrowers sign it then it cannot be registered.

The proposal may state that the property will be subject to equity release and may not have been excluded but any remortgage would be impossible without your partner's consent so the IVA would have to be extended anyway. Your partner would be entitled to ask to see a copy of the proposal to see how the property was addressed and until then it is a bit of a guess.
jonboogaloo
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by jonboogaloo » Mon Sep 04, 2017 6:34 pm
Michael Peoples wrote:
When an IVA is approved there is usually a restriction placed against the property which has no value but is registered at Land Registry. It is possible that the IP did ask your partner's ex to sign the restriction but unless all borrowers sign it then it cannot be registered.

The proposal may state that the property will be subject to equity release and may not have been excluded but any remortgage would be impossible without your partner's consent so the IVA would have to be extended anyway. Your partner would be entitled to ask to see a copy of the proposal to see how the property was addressed and until then it is a bit of a guess.



Thanks for the further clarification :-)

Out of interest, if my partner writes to the IP and it becomes apparent that the property was never declared (can that happen if her ex didn't declare it? her ex will isn't a rational thinker so we don't put anything past him, like earning cash in hand to avoid CSA) would the fact that the property now becomes 'known' be an issue??
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Michael Peoples
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by Michael Peoples » Tue Sep 05, 2017 8:06 am
If an asset was deliberately left out this would be a 'material omission' and the IP would need to take action. This is potentially a criminal matter and would almost certainly lead to the IVA being failed. This could result in bankruptcy proceedings which would put the property at risk. Hopefully this is not the case.
jonboogaloo
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by jonboogaloo » Tue Sep 05, 2017 5:38 pm
Thanks for the clarification. We would be better off asking him directly in the first instance I think.
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