Fred is 69 years of age and lives with his wife who is 71 years of age in a property valued at £100,000, which is jointly owned with his wife and has no mortgage.
He has unsecured debts of £90,000 in his sole name.
Due to his age he no longer works and is now struggling to pay his debts.
Apart from half of the equity in his home amounting to £50,000, he has no other assets.
Will he be able to put forward an IVA and would his creditors accept it?
In order for his creditors to accept an IVA, the proposal would have to demonstrate that they would receive a greater benefit than should a Bankruptcy occur. An IVA proposal would ne likely to be accepted because of the much lower costs involved in the IVA process.
Fred would have to offer in an IVA (or make available in any Bankruptcy) his half share in the equity in the house.
In an IVA, because costs are lower creditors would receive a higher dividend than would be the case than in a bankruptcy.
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