94% of IVA's we propose
are accepted by creditors
Established for over 7 years and enjoy an excellent relationship with creditors.
Regulated and monitored by the Insolvency Practitioners Association
Rated 4.43 out of 5 from our customer surveys and 4.4 / 5 on reviewcentre.com* 100% of customers would recommend us to a friend*
*Review scores correct as at August 2015 *Recommendations are taken from reviews submitted between June and August 2015
An IVA protects essential assets such as your home from unsecured creditors and provide allowances within your expenditure budget to maintain secured payments. This means you can retain ownership and continue living in your home.
This is unlike:
Therefore, when considering an IVA, creditors need to know exactly how much potential equity is in your property to determine whether the IVA offers your creditors an acceptable return compared with the alternatives.
To qualify for an IVA you must firstly be insolvent. There are 2 ways to determine whether you are insolvent or not.
Most people with assets of value are deemed to be insolvent based on point 2. Homeowners with high levels of equity can still qualify for an IVA, as an IVA may well be an acceptable solution for your creditors (companies you owe money to). An IVA can offer your creditors a reasonable return on what you owe compared to alternatives such as bankruptcy.
In these circumstances an IVA may still be a viable option for you in order to protect your home and avoid having to sell to repay your creditors. The IVA must also be a fair solution for your creditors and as the current climate makes it difficult for people to sell their home or even obtain a secured loan or mortgage to repay their debt, creditors may consider an IVA to be a fair payment option on what uyou owe.
At Debt Support Centre we are able to review and advise on IVA’s for people who have large amounts of equity to consider whether this is the best solution for all parties.
When considering whether an IVA is suitable for both you and your creditors it is important to be realistic about the available equity in your property. Therefore when considering an IVA, Debt Support Centre will prepare a comparison which shows what creditors could expect to get back should you or your creditors look to declare you bankrupt and compare this with what you propose to offer in your IVA.
The calculation of your property equity will be done by firstly using the most recent market valuation of your home (usually obtained for free from independent valuation sites on the internet). We will then allocate a value equal to 85% of the market value and then subtract any mortgage, secured loans or charges. We will also take account of the interest of any other owner of the property such as your spouse or partner.
Market Valuation = £200,000
85% of Market Valuation = £170,000
Less Mortgage at £120,000 = £50,000
Partner share of Equity @ 50% = £25,000 (usually for matrimonial homes in the UK insolvency law, ownership is considered to be a 50/50 split unless stated otherwise in the deeds)
IVA EQUITY = £25,000
There are two main reasons we represent the property value at 85%.
It is important to note that when considering an IVA as an option to deal with unmanageable debts creditors will almost always be agreeing to write off debt that you cannot afford to repay.
Therefore, they expect homeowners to look in to the possibility of remortgaging their property or obtaining a secured loan just before the end of the IVA to realise equity if it is affordable for you to do so. They will not expect you to sell your home and they will not expect you to take on an unaffordable mortgage or secured loan.
It is important to note the factors taken in to consideration when considering the remortgage or secured loan as part of the IVA.
6 months before the completion of your IVA, your IVA Supervisor will work with you to consider your current equity position and affordability.
Your Supervisor will:
If there is no equity or the value of the equity is less than £5,000 your IVA will conclude without you having to pay anything further. You will not be asked to sell your home and no further investigations will take place.
If there is considered to be equity greater than £5,000 but you cannot release the equity because:
It is likely in these instances that creditors will request you to pay 12 additional monthly payments into your IVA in substitution for not releasing equity. You will not be requested to sell your home and no further investigations in to a remortgage or secured loan will be required. You will simply make 12 additional monthly payments and the IVA will conclude successfully.
" I really don’t know what I would have done without the IVA. I was recommended by my brother’s friend back in 2008 who was in a similar situation. Definitely the right thing for me to do. I am now building up my credit status so I can hopefully obtain a mortgage in the future. I am more careful with money / finances now and don’t take credit for granted! Thanks very much for everything the team has done for me!"Read More
Subject to eligibility and acceptance. Fees Payable. Debt write off applies to unsecured debts only and on completion of an IVA. If your IVA fails, it could lead to Bankruptcy, although this is rare and alternatives may be available. Your ability to obtain credit will be affected for the medium to long term. Homeowners may be required to release the equity in their property, if unable to release equity and equity is available creditors may request an additional 12 months payments in compensation.
Debt Support Centre Ltd provides insolvency solutions to individuals, specialising in IVA's. We do not administer or provide advice solely relating to debt management products, such as Debt Management Plans. Advice and information on alternative options will be provided following an initial fact find were the individual(s) concerned meets the criteria for an IVA and wishes to pursue it further, as governed by our regulators The Insolvency Practitioners Association. All advice given on any alternative options is therefore provided in reasonable contemplation of an insolvency appointment.
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