A couple of IVA issues

Davey56789

Hi guys, first time poster long time worrier !

This is a long and complicated and sometimes quite interesting story (question) so please try and keep up J

Here’s the background. Sitting comfortably?

About 6 years ago now, I entered into an IVA with an ex partner I was living with (and had a child with) at the time. About a year (maybe less) later, the relationship ended and I moved out and back with my parents for a while, whilst obviously still keeping up my side of the bargain and paying my half and obviously child maintenance. During this time, both me and my ex partner have married other people and the IVA is actually due to finish this Friday 31st Jan 2014. However, and this is where the complications come in, the actual terms of the IVA have never been discussed with me (certainly not after the initial agreement was made and a lot has gone on since then, I have moved house twice and got married), so when I proposed to my wife back in 2011, I got myself a credit card shortly after to pay for my share of our wedding. Now after speaking to my ex yesterday about all things IVA, I understand that IVA’s can default if further credit is taken out whilst in the agreement. Does anyone have any info on this? There is about a grand or so left on the card and I am worried that I am going to be made bankrupt due to a technicality when I didn’t know any of theT’c and C’s of the IVA?

Secondly, the agreement at the start of the IVA, was that any equity in the house (that ex partner still lives in) would be used as a sort of balloon payment at the end of the 6 year agreement. Now, due to house prices and the economy as a whole being pretty shocking over the last few years, there is no equity in the house and therefore, we have only paid 28% ofthe 40% we agreed with the creditors at the start of the IVA. The current situation with the IVA, is that a company are dealing with the equity claim,basically confirming house price and equity against what is owed on the remainder of the IVA. Apparently then once this is complete, there will be a meeting with the creditors to assess what happens next. The options will be, I’m guessing, either extend the IVA for a further 12 months to cover money missed with the negative equity, PPI claims will be taken into account and IVA will be concluded or they will end the IVA and ask for the remaining money to be paid up front. To add to all this, myself and my wife put a reserve down on a house on Saturday, under the assumption that the equity in the house was to be written off against the IVA and previous partner would be able to re mortgage, removing me from that mortgage, enabling me to get on with my life and buy a house. We had the initial credit checks done on Saturday and the mortgage has been agreed in principal and we have until late March to provide evidence that I am off my ex partners mortgage and then the ball can carry on rolling. All the mortgage advisers and mortgage companies we have spoken to, have said that all checks, apart from income and proving who you are etc have been done.

I hope you have kept up with all this, not a normal situation is it.

To summarise my queries, now you know the background:

1, What affect will me getting a credit card have on the IVA, baring in mind I have never been aware of the T’s and C’s of the IVA ? (Yes I know their argument would be that I SHOULD know the T’s and C’s)

2, What checks are done at the end of an IVA?

3, Would it be best to get my wife to pay the remainder of the card off ASAP and hope for the best?

4, Is it best to proceed with my current mortgage application and what affect will this have on the IVA if we do?

5, Based on what is happening at the moment with the equity release and meeting of the creditors, can anyone advise what outcome the IVAwill have? Will it be extended or will they ask for anything as a lump sum?

Thanks for ANY Help on this.

Foxy-Stoat_3

IVA's are 5 years plus 1 extra year if the equity release fails. Are you sure its about 6 years since you took out an IVA, or about 5?

Cannot believe you actually got a credit card whilst still in an IVA, the bank must of carried out credit checks! Taking out additional credit while on an IVA is a serious breach if they find out. I had a credit card with a zero balance and I started spending on it throughout my IVA and was never picked up so cross fingers as see what happens. Settle the card now and close the account.

Have you told your mortgage lender about your IVA? Still hard to believe that they even gave you a mortgage in principal whilst still in the IVA. What sort of deposit did you have to put down?

Davey56789

Yes definitely 6 years. It was initially 5 years but then as far as I am aware, it got extended by my ex in the early stages to 6 years to bring the monthly payments down. So do you think it can still be extended by a FURTHER year based on the equity release?

So you got away with it then? Do they not do any checks when the IVA is drawing to a close? Credit checks or whatever?

Yeah mortgage lender is aware of the IVA and they have said it's not an issue. They have done the checks and have said they are happy. All they need to do now is just prove our income and we need to show the usual ID, passport, driving licence etc. We have been gifted a deposit so not our own money which I suppose is ok in terms of the IVA, but obviously if we carry on with the mortgage and the house goes throigh, then if the IVA gets extended, the IP will have access to the house?

Foxy-Stoat_3

Your IVA wouldn't of been extended, the IVA contracted payments are for 5 years at the affordable level. You would not be able to have it extended to reduce payments. Are you sure your Ex is being truthful. Do you have a copy of your original IVA contract?

Have you been in touch with your IP recently?

In my case they did not do any credit checks otherwise they would of seen the credit card payments and spending. No idea about your one though.

If your IP finds out that you have taken out a new mortgage with gifted money you may be in another world of pain as may be classed as a windfall and require all the money...tread carefully here.

Davey56789

Foxy-Stoat wrote: »

Are you sure your Ex is being truthful.


Ah the 64,000 dollar question I suppose I have to believe what she says but maybe I need to start looking at some contracts and digging a little deeper. One thing I have seen on various forums is that every IVA is treated differently.

I'm fairly certain the IVA was extended but maybe it was extended based on the assumption that the equity in the house would negative.

I think I need to do some digging. Cheers

Foxy-Stoat_3

Do you pay the IP directly or are you paying a standing order to your Ex?

Davey56789

I pay my ex my half of the IVA along with child maintenance every month.

MisterBaxter

I was under the impression that an IVA was exactly what it says, an individual arrangement. Each party would have their own agreement based on their debts at the time and each party would be responsible for knowing, understanding and meetings the terms of their agreement.
You need to look through your documents and be clear on the exact terms. You need to discuss the issues with your IP and be certain that you know what is happening, if the term has been extended to 6 years due to lack of equity you should know about it.
When my wife and I went through an IVA we saw the IP together but it was made very clear that we were each responsible for our own agreement and the IP made sure we were both present at any meetings as they couldn't technically discuss the agreement with the other party.
I remember being given a big list of do's and don't when we. Went through the IVA, new credit was a no, unforeseen windfall such as inheritance or winnings needed to be reported to the IP for a decision etc.
If you got a mortgage offer in joint names with your new partner well done, it has been 7 years since our IVA completed and we are only now seeing opportunities open for mortgage offers.
Bottom line is don't take anyone's word for it other that your IP, after all it what they are the for.

Free_Bird

I too have a credit card, carrying more than the £500 that my iva allows. You should be ok as long as you don't default etc.

Also I have heard that a cash 'gift' is not a 'windfall', so your mum's gift to you is safe.

Foxy-Stoat_3

Free_Bird wrote: »

Also I have heard that a cash 'gift' is not a 'windfall', so your mum's gift to you is safe.

Assume makes an A S S out of U and ME !!!!

Good luck with it.

Davey56789

Thanks guys, honestly any help is really appreciated. A sticky situation as i'm sure you will agree. Will post more when I know more and let you know how I am getting on. Thanks again