You will find Mel's team a whole lot more understanding (and dare I say on the ball). What many people do before debt becomes unmanageable is not taken apart, scrutinised and judged in minute detail. I see no reason why what you have told us should unduly jeopardize an IVA.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Hi Neil, I think for anyone taking out an IVA the main thing to ensure you understand and get the best deal about is equity clause.
Times are changing and house prices are rising. Someone with a 150k mortgage and no equity at the moment may think they will be excluded. However with just a modest 5% annual house price increase, at the end of the IVA term they could have a property value of £192k and equity of over £62k. On those terms you may see some firms willing to offer Mortgages and you certainly would be expected to get a secured load on these terms.
More and more, IVAs will be taking this increased equity that previously could not be released. So eveyone just needs to understand how much unsecured debt may be converted to secured debt at the end of the agreement and how much this will mean the debtor actually pays overall. As at the uncompetitive secured loans rates, it may actually be more than the orignial debt.
Getting a massive secured loan with a terrible APR at the end of an IVA just seems like total madness to me? How many loans/mortgages would you have to apply for until they would be satisfied that you cannot get one and who gets to decide what firms are used?
Last edited by Neil_ on Thu Jun 05, 2014 4:44 pm, edited 1 time in total.
Most on here agree but an IVA is about getting the best deal for creditors as well and they do not take kindly to debtors sitting on large equities whilst not having paid all their debts.
However, in your case, even if a SL was sought at the end of the agreement. It can only be the value of the original debt (plus IP fees) less what you have paid in during the term of the IVA.
So if you are paying say £400 a month, you would have paid in £24000, so you would only owe 35k-24k=11k, so ad on IP fees (£6,000), so a potential amount of £17k still owing.
If you got a secured loan for £17k, you are likely to pay back £34k + £24k you have already paid.
It's all very well Insolvency Practitioners not feeling comfortable with a certain clause within the protocol regarding the secured loan, and I respect that , however it is not the Insolvency Practitioners who vote on the proposal.
There are safeguards within the proposal that make sure that any re-mortgage or secured loan is not unaffordable, which would ultimately put you back in a position of financial distress.
I'm sure these will be explained by Melanie's team.
Thank you for that Neil, and I did enjoy our chat. Just about to e-mail you the information I promised, and hopefully we can hook up together again to run through things further.
