Will I lose my house and car if I get an IVA?

If you’re a homeowner then under the terms of your IVA you will be expected to release any equity in your property. This is usually done in the 4th or 5th year of your IVA and will be assessed on an up to date property valuation and mortgage statement at that time.

Unlike bankruptcy, an IVA allows you to stay in control of what happens to your home. If you’re a tenant then you can continue in your property as before and there’s no legal obligation to let your Landlord know about your IVA.

When it comes to motor vehicles, you will be allowed to keep these during an IVA providing you can demonstrate a need for them, i.e. family transport or commuting to and from work. The only exception to this is if you have a vehicle that’s exceptionally valuable. In this case, you may have to sell it and buy a cheaper one with the difference going to help pay off your creditors.

Mortgages and H.P. agreements are classed as secured loans and as such won’t be included in your IVA. So if you have a car that you’re still paying off, these payments will be taken into account as a reasonable living expense. If you fail to keep up your repayments on your home or vehicle then they are at risk of being repossessed.

If you found this answer helpful you may also want to look at the following:

What happens if I miss an IVA payment?