Ex wants to go for an IVA. Where does this leave me?

CG77

Good afternoon,

I’m asking you knowledgeable people to help out with a question for my partner. His ex wife (not yet divorced as he thought he was doing the right thing for their daughters not forcing things with the house etc, but separated for years) is planning on doing an IVA and he has no idea where this leaves him.

They have a house in both names. He lived there for one year then she asked him to leave. She has lived there for 10 years, moved her new partner in, then decided to walk away and stop paying the mortgage. The house is in massive negative equity and advice has been to hand the keys back. Once this happens she plans to begin an IVA. How will this work? Will some of her share of the shortfall be included in the IVA and he will be left with all the rest to pay? How will it work?

I hope that makes sense!

Thank you

MovingForwards

As it's joint all the shortfall will fall on his shoulders if she gets an IVA.

How much would the shortfall be?

Does he have another house in his name? Does he have any other debts? Is he, currently, financially stable? Is he working? Is there any reason he didn't move back in after she went and try to resolve it then?

Just trying to get a bigger picture to be able to allow people to offer advice.

CG77

MovingForwards wrote: »

As it's joint all the shortfall will fall on his shoulders if she gets an IVA.

How much would the shortfall be?

Does he have another house in his name? Does he have any other debts? Is he, currently, financially stable? Is he working? Is there any reason he didn't move back in after she went and try to resolve it then?

Just trying to get a bigger picture to be able to allow people to offer advice.

Thanks for the reply.

We have no idea what the shortfall would be-I guess that depends what they sell the house for once they hand the keys back. I’m worried the mortgage company may sell waaaaay under value and pass the shortfall to him. Can they do that?!

Yes he’s stable but no savings at all. He works full time. He didn’t move back in as he has moved with me to another part of the country where we’ve been living for 6 years together. The house is mine not his (because he couldn’t get another mortgage because he was allowing her to stay in the house with the children)

MovingForwards

You can take a wild guess at the shortfall by having a look to see what similar properties sell for in the area, that will give you an idea of the minimum to expect.

Mortgage companies are no longer allowed to sell for silly money, they have to get a realistic amount back; the change came in several years ago. Which should be a bit of a relief for you to hear. But, obviously solicitors fees etc are also payable by the owners and added on.

Unfortunately, the limitation for a mortgage company taking legal action is longer than normal civil claims, I believe it's 12 years.

You never said if your partner has any other debts? But as you say he is stable I assume he doesn't. If he does, then there are potentially options, especially as the house is in your name; but that would need some of the other members to cover and they would need more information.

Your partner can pay the shortfall by instalments, as banks/BS know people don't tend to have the money sitting in the bank if there are arrears/shortfalls. But each bank/BS has it's own requirements.

foxy-stoat

No idea why the ex has opted for an IVA - they should just go Bankrupt.

Your partner will have to pay the shortfall once it is sold, has he been contacting the mortgage lender and kept them up to date on what has been going on?

Do you know the redemption figure and what it will likely fetch on the open market?

foxy-stoat

CG77 wrote: »

The house is mine not his (because he couldn’t get another mortgage because he was allowing her to stay in the house with the children)

You have dodged the biggest bullet there! Whatever happens now, even if it costs him 5 years of paying a few hundred a month, you are winning.