Ending IVA Early?

Scubabe

G'day,

I'm not from the UK so don't really understand IVAs and things... But my husband has an IVA, he pays £225 per month to some company who pays his creditors for him? And he said that at the end of 5 years (he's 2 years into it) then he has to remortgage the house to give them another £20K and then it is all over.

Well.... he's just been offered a new job (very highly competitive industry, he's been trying to get this job for 4 years now!!) and we need to move ASAP as he'll now be based 200 miles away. So we are thinking we'll sell the house and pay off the mortgage and then pay off the IVA company.

Has anyone ended an IVA early and was it easy, do you need to ask permission from the IVA company before you are allowed to sell the house or anything like that?

How does it work with ending it early?
1) Can we "make an offer" e.g. ask them if they will accept under the £20K? Would that be likely to work or would he get laughed at?
2) Are they more likely to say "ooooh wow look at all that fabulous money you have in the bank right now, we'd actually like to take the full £40K instead thank you very much".

I'd hate to find out that because we are selling the house they are entitled to realise more of the debt... we're going to need all the money we can get for our new life down south, houses are expensive in London!!!

Thanks in advance for any replies!!

Ness

fermi

I remember reading of people doing an early settlement on IVAs, but it's not something I've look at in depth.

While you are waiting to see if anyone here has, you may find some more info by having a search here:--> LINK

lexie2005

I have an iva & the way I understand it is that if you come in to enough money to pay off your creditors in full, ie you sell the house & the equity would cover the total amount you have to give them it. Well that is how it is with ours anyway. Good Luck

Scubabe

Oh gosh.... uh oh. Not what I wanted to hear

Will do some searching on the forum for others who may have been in a similar situation...

But if we have to pay back what he actually owes then we will not have a single penny left after selling the house, so no hope of buying again in the UK. *sigh*

Thanks for the responses so far, I will do some searching over the weekend and may be back with more questions!!

Ness

balmk

Hi, it is definitely worth discussing this with your IVA supervisor. It may be that there are other options availible. The supervisor is not just there to ensure that you make payments etc..., but should also offer you support and guidance at times like these. It is feasible to consider that because your husband's salary has gone up that the creditors will agree to to continue the IVA as it is, but with a higher monthly payment plus the £20k at the end to allow you to move. Either way, your supervisor should be able to offer some guidance or at least set a realistic expectation. Hope that helps and that it all works out for you.

Scubabe

Hi all,

I just wanted to post an update in case anyone else is in the same situation and would like to know what happened to us.

We sold our house to one of those "buy your house now for cash" companies. We got a fabulous price and settled in just 6 weeks.
We wrote to the IVA company as soon as we had an offer on the house, offering them just £16K to pay out the IVA 2 years early. In essence, they would be missing out on 2 years @ £225 per month, plus £4K less than the agreed lump sum at the end, total saving £9400.
The IVA company sent someone to value the house to check our sale price was realistic, and they needed a confirmation letter from our solicitor to say he'd hold £16K out of the sale proceeds for the IVA.
Once the IVA co got the assurance from our solicitor they lifted the note on the land registry and we went through with the sale.
Sale completed 3 weeks ago, a cheque for £16K was sent to the IVA company, and we cancelled the standing order for the monthly payments.
IVA company held a meeting of the creditors yesterday to see if they would accept the offer of £16K, and woohoo it was accepted!

So we've ended the IVA 2 years early and saved almost £10K.

I'm really glad that my hubby has finally cleared up the financial muddle he got himself into a few years ago before we met, now we can concentrate on getting his credit reports cleaned up and then we can move forward with a fresh start.

Phew!

Nicola182

Hold up - am I reading this right?

I'm currently in an IVA paying 262 per month, on an original debt of circa 35k (don't have the original figures to hand, sorry).

Will I owe them a further payment after the 5 years is up?!?! Ie the remainder?! Anyone who has read any of my previous posts will know I wasn't in the right frame of mind when I entered into this!!!

Eeeeek!
:mad:

10past6

Nicola182 wrote: »

Hold up - am I reading this right?

I'm currently in an IVA paying 262 per month, on an original debt of circa 35k (don't have the original figures to hand, sorry).

Will I owe them a further payment after the 5 years is up?!?!

Eeeeek!
:mad:

If you own your own home, you will have to remortgage after year 4, then any equitiy, the IP can request upto 85% of the equitiy.

Who is your IVA with?

Nicola182

IVA is with Money Debt & Credit. (Please don't shout at me!!)

Don't own my own home - I'm only 24 (The Apprentice styleeee!) and am living with my dad at the moment.

Thansk for helping!!!

10past6

Nicola182 wrote: »

IVA is with Money Debt & Credit. (Please don't shout at me!!)

Don't own my own home - I'm only 24 (The Apprentice styleeee!) and am living with my dad at the moment.

Thansk for helping!!!

I'm not here to shout at you Nicola but from your post above, it sounds to me as though you may well have been mis sold an IVA, did you have any assests when you commenced the IVA, i.e home?

Nicola182

Nope, only my car which I needed for work (1997 mini cooper, worth around 2500!!)

I took the easy option of going into this. What do I do now?!?!?!

Thanks again