debt is unsecured, why insist on remortgage in iva

[a.h]

Hi,

i have just been to see a IVA, consultant. they are advising me to do a IVA, becuase the amount of debt i am in. However, for the IVA to be Approved, i have to start with monthly payments untill i can remortgae as i am in a right to buy house. Secondly they want me to remortgage my house and realease some equity, to give to my credits, a lump sum, which will 'in theory' right off the remaing debt. the tricky situation is i have bought the house with my partner, and she is a little apprehensive, about remortgaging, for the sake of MY IVA. all of the debt is unsecured, so why can they make you remortgage?

[gimmewine]

I'm not an expert but as I understand it, if you go into an IVA you have to pay as much as you can towards the outstanding debt. Therefore, if you have equity in your property, that is something you can pay towards your debt and as such they will ask you to remortgage and release part of that equity.

Did you just consider IVA or have you looked at other options? It may be that in your particular circumstances an IVA is not your best option.

[MelanieGiles]

Hi ah

A remortgage of your property is just one way of funding an IVA, you could also offer contributions from your disposable income for a five year period, but you will undoubtedly be asked by the creditors to effect a re-mortgage at the end of that period and introduce monies from your share of the equity.

As you are in a right to buy property, are you still in the Council's three year penalty period? If so, I hardly thing that now is the right time to re-mortgage?

What concerns does your partner actually have? Borrowing on a mortgage tends to be far cheaper than continuing to pay interest on credit cards and loans.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[a.h]

Thanks, for the advice. it helps to get to get advice from another perspective. The IP, wants us both to do the IVA, as she has debt as well, but the impression she got from the IP, they are just looking at waht is in for them. lets not forget they take a huge proportion of the mone being paid via them. we have sat down, and calculated are income and expenditure. we currently have about £67,000 worth of debt, mine being around £48,000. would it be best to do a joint IVA, or let me do the IVA, on my own. Yes we are in the 3 year, penalty. so we couldnt remortage for another year anyway. But, the IP, is trying to pursuade my other half this would be the best option, but my partner is having none of it. she thinks, we could be getting into more debt, by remortgaing, becuase then we are left with a higher mortgage to repay. any advice or soloution would be grealty appreciated. thanks

[aguise]

Hi ah
There is no joint iva it is two which run side by side .We have one.
All your income and expenditure is joint and so is the monthly payment just a single payment. Mine is working well . If some of your loans are joint then they would expect your wife I think to pay them if she did not have an iva. I think they generally expect you to release equity in your property via a remortgage, usually in the fourth year. Others will be along to advise, just a bit of info that may help.

Ang

[Adam Davies]

Hi
If any of your debts are joint then ,if only one of you takes an IVA, the other person would still be liable for the whole of that debt,so it may be best to both propose an IVA.
In terms of costs its your creditors that pay for your IVA and not you so do not let this stop you from doing whats best for you.
Can I ask your disposible income figure[joint] ?
Regards

Andy Davie
IVA.co.uk Spokesperson and site manager
(aka Neverending)

Please check out my blog: http://andydavie.blogs.iva.co.uk

View my profile here:
http://www.iva.co.uk/andy_davie_profile.asp

[a.h]

Hiya,
thanks for your responce.

None of the debt,is joint. mine is personal loans whereas my partners is from a graduate loan, and credit cards etc. are disposable income, is about £400 a month, after all bills have been paid. this is not taking into consideration, what we pay for loans etc. My parnter has only 3 and a half yrs to pay back her loan, whereas mine is about 7 yrs. i am trying to pursuade her to go joint with the IVA. so we can combine all of the debt. but she cant see the logic behind it.

can any one advise what next steps to take?

[Adam Davies]

Hi
The next step is to continue posting questions until you are sure that you are ready to enter an IVA.Also speak with your IP again and get them to answer any querie that you may still have.Also it would be useful to have a second opinion from another IVA provider.You will also need to have the full support of your partner if you are going to enter an IVA because the five years on a tight budget can be very hard.
Regards

Andy Davie
IVA.co.uk Spokesperson and site manager
(aka Neverending)

Please check out my blog: http://andydavie.blogs.iva.co.uk

View my profile here:
http://www.iva.co.uk/andy_davie_profile.asp

[a.h]

Thanks fir the reply. MY IP, is very arogant, and this is why my partner does not want to go throught the IVA. she has not explained the Pros and cons, for going throug this IVA. all she has expalined, is that a IVA is the best option. As i said currently, ny total debt is about 48,000, my IP, has said the creditors, will want at least 26,000 back, and that is what she is asking from me to go through with the proposal. this includes; around 18 months paying into the IVA, the remortaging the house thereafter to realease some equity in the region of £20,000. which would be my share of the equity. however because i am in a joint mortage, this would mean my partner has to agree, now for the re-morttgage to take place, in the future. i would assume they would expect that in writing? what if we cannot afford a remortgage in the future, who decides how much they want back?

after the last visit to the IVA, my IP is becoming a little irratable, becuase my partner is saying, she wants me to think about going through with the IVA, before it set in stone. i get the impression some IP, dont like to be challegned and that is what my partner was doing, in the meeting. i know she has my best interest at heart, but i just want to get ut of debt, as soon as. BAnkruptcy is not a option as we have a house, and two cars. however with a indirect mortgage, the deeds are only in one name, but the mortgage with the bank is in two. would this make a difference, if bankruptcy was to be considered as a option?

thanks

[tracy.h]

Hi a.h,it doesnt sound like you are getting a lot of support,have you thought of trying another company before you commit to your iva,5 years is a long time to be in an iva,if you dont have 1.your partners support 2.an ip that you feel comfortable with,if you feel that she is irratble now and your iva is not complete,it doesnt say a lot if you do have problems further down the line,i honestly feel you should seriously consider your options,its not worth causeing friction with your partner.If you do go down the iva route,then you will need to support each other,regardless if both or one of you go into an iva,i dont see why your ip has a problem,i agree with your partner,take your time,and talk to another company,even if its just for advice,you will get good advice on this forum,why not speak to one of the companys who post on here.
I hope you can find a solution and start to move forward,best of luck
Tracy

[sps]

Hi a.h
I agree with Tracy you need to feel comfortable with your IP as you are going to have a relationship with them for the next 5 years. At least give you and your partner the benefit of a second opinion - the IP's who take the time to answer questions on this forum are well worth a try. I know you probably feel as if you want to sort things out as soon as possible - I felt like that - but an IP who you find "arrogant" is not a good start. Wishing you the best of luck
Sue

[Skippy]

Hi a.h., I agree with the others that you need to feel comfortable with your IP. If she is arrogant and unhelpful now it worries me what she might be like if you need help in the future. 5 years is a long time to exist on a budget, and you need to be happy with the whole package - IVA proposal, payments and IP. Contact a few companies who post on the site - it's worth getting a few opinions before making the commitment. Good luck

Onwards and upwards!!!

View my blog at http://skippy13.blogs.iva.co.uk/