Will I Lose Any Personal Possessions If I Have an IVA?

A common belief about Individual Voluntary Arrangements (IVAs) is that you will have to give up all of your personal possessions in order to fund the payments that will be made to your creditors, however, this isn’t actually the case.

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When planning the details of your IVA proposal, creditors will take a look at the value of your possessions but will only request that you sell them if they are deemed to be a luxury and if they think the money from the sale will be more useful to you by paying off debts than it would be to keep them. For example, they wouldn’t request to sell items such as your wedding ring or mobile phone, they would instead consider things such as expensive boats or financial assets.

Both ourselves at Abbotts and your creditors understand that for many people a car is a necessity for everyday life as it is used for work, running errands and other responsibilities. That’s why creditors will only ever ask you to sell your car if theythink it is worth an “excessive” value. Commonly creditors are happy that any car valued at less than £5,000 can be retained. Or if the vehicle is subject to finance and has no equity these are also likely to be ok to keep.

However, any vehicles that are worth less than a few hundred pounds are unlikely to be requested as they would not necessarily be considered a luxury on a commercial basis.


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Our job as your insolvency practitioner is to work with both your and your creditors to make sure that you can repay your debts whilst still enjoying a comfortable and affordable life. That’s why the following everyday items won’t be sold:

  • Clothing

  • Furniture and fittings

  • Electricals e.g. TVs, computers and phones

  • Cooking equipment and white goods

  • Children’s toys or equipment such as prams or car seats

  • Medical aids such as wheelchairs and stairlifts

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Will I need to include any financial assets in my IVA?

As part of the Arrangement, you are legally required to declare all the assets you own/co-own such as any significant assets you own such as investments, shares, endowments, insurance policies and ISAs which may be redeemed or sold in order to pay off some of your debts, however, it’s important to know that you can reject or accept the creditor requests if you so wish. Unfortunately, if you do refuse their request, you may be prevented from setting up your IVA and will therefore have to seek an alternative solution such as debt management, but it’s always worth speaking to your creditors first to see your options.

Some creditors will refrain from asking you to sell your assets in certain circumstances such as if your ISA is linked to your mortgage and you must keep it as part of the condition. Similarly, insurance policies such as life insurance are unlikely to be included or they may ask you to alter your insurance premium if they think you’re paying too much and could find a cheaper one. By reducing the amount you’re paying for your insurance, you will be able to make higher repayments on your IVA.

What if I gain any assets in the future?

If you manage to gain any assets during your IVA, you must declare them to your insolvency practitioner immediately. If you do not disclose them, you could be in breach of your IVA agreement and may cause it to fail, unfreezing the interest on your debts and allowing your creditors to take legal action against you. Some examples of future assets or windfalls could be a lottery win or inheritance. These will be used to put towards your IVA and may even cover the entire costs of repayment.

For more information about IVAs or other solutions such as bankruptcy, Debt Management, administration orders, consolidation and Debt Relief Orders, visit our Tips & Advice or get in touch with a member of our team who will be happy to help. To find out if you’re eligible for an IVA, just answer a few questions here and one of our team will be in touch to discuss it with you.

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