StepChange won’t talk to us about our IVA - catch 22

loulou116

We are in a massive catch-22.

In Jan 2012, we started our IVA with StepChange.  As our house was rented out and tenanted, part of the agreement was that at the end of the payment term (2 years ago), funds would attempted to be raised to pay off a greater amount to the creditors, the main one being NRAM.  Roll on to this year and after seeking a Variation to the IVA regarding the rental property (we offered further payments instead of trying to obtain funds we have no chance of getting, plus the house is needing more and more repairs), the main creditor said no, we must sell the property.  However...

Once the tenants knew the house was on the market, they moved out.  Now we have no tenants, the covid mortgage holiday is ending and a big list of repairs to get the house back up to a lettable standard (as advised by our estate agent) and now, no income from the property either!  We cannot have tenants until the property is repaired (damp course, rendering, wood worm, Electrics, new kitchen etc).
we can not afford the repairs without obtaining some form of credit.  We cannot get credit while still trapped in the IVA.  We cannot sell the house in its current state at a price to gain anything from it (for the creditors, nevermind ourselves).

But... SC are refusing to talk to us about it as the variation meeting decided we must sell the property to raise funds, end of.  We have tried emailing to say we need to speak to them urgently - at this stage they don’t know we don’t have any tenants because they won’t let us talk to them!

The current situation is now costing us nearly £580/mth.  We can’t keep going like that. As a last resort, would a voluntary repossession be the way forward? Hand the property back to NRAM and say ‘sort it out yourself’?  

mwarby

It sounds to me like you need to write a clear and concise email, detailing the state of property, lack of tenants and the likely sale price(I'm sure your estate agent could help there). It's likely that you need some of the IPs time, but they don't just agree to a meeting, as they can be a poor use of time(which they might now think is debtors remorse re agreeing to sell in first place). A brief email or letter can be scanned by the IP in a few minutes to get the relevant info, and allow the IP to work out what to do.

I'm not sure how voluntary repossession would work in an IVA, but can't see it being welcomed (as they need to do the work to sell it). It maybe that it's agreed you sell it at a loss (but smaller loss than if they need to reposess, and handle the sales process themselves)

ToxtethO'Grady

It's not up to the IP it's up to the creditors agreeing what would happen at the variation meeting. You can outline your situation in an email as suggested by mwarby however the IP's hands are tied if the creditors will not agree.

sourcrates

You have somewere else to live i take it ? in which case just accept the loss, and try and sell it as it is, if thats what they want, and its your only option, there is no catch 22, you will have to do it.

You are right at the end of your arrangement, it would be folly to fail it now, i know its probebly a big blow to you, but looking at the facts there is no other solution here, except to fail the IVA and declare bankrupcy, in which case you`d lose everything.