Investors are naturally anxious that bankruptcy will adversely affect their chances of recouping any of their money. Liam Collins and David Bone Jr are playing on investors' anxiety to try to win support for an IVA. They are claiming that the mortgage company would board up all the houses and sell them off at a loss.
However, this is the view expressed yesterday by the Head of Commercial Lending at UKAR (which is now responsible for MX mortgages) about how they would handle the situation:
“In the case of HMOs (houses in multiple occupation), we abide by any tenancy agreement. The houses would be managed by a receiver (LPA), who would collect the rent and pay the mortgage and expenses. The surplus would go to the creditors via their trustee.
It would not make business sense to sell them if they are commercially viable and UKAR would be prepared to administer them in this way for many years.”
So if, after bankruptcy, the investors appoint a trustee, the financial situation will be very similar to that of an IVA. The critical difference is that Liam Collins’s and David Bone’s finances will be scrupulously examined. And they will be completely separated from any assets which will be administered by competent personnel.
However, this is the view expressed yesterday by the Head of Commercial Lending at UKAR (which is now responsible for MX mortgages) about how they would handle the situation:
“In the case of HMOs (houses in multiple occupation), we abide by any tenancy agreement. The houses would be managed by a receiver (LPA), who would collect the rent and pay the mortgage and expenses. The surplus would go to the creditors via their trustee.
It would not make business sense to sell them if they are commercially viable and UKAR would be prepared to administer them in this way for many years.”
So if, after bankruptcy, the investors appoint a trustee, the financial situation will be very similar to that of an IVA. The critical difference is that Liam Collins’s and David Bone’s finances will be scrupulously examined. And they will be completely separated from any assets which will be administered by competent personnel.
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