Do I have to pay more?

[stupidjon]

Hey Folks

I'm currently in month 38 of an IVA (repaying a whopping 57p in the £) and feeling pretty self righteous but worried about the impact of the dreaded year four equity release clause...

Since I'm likely to be on substantially more money than at the time of the last review and my flat will be worth around £95K with a mortgage of £60K, seems like I'll be making an early exit from the IVA (if I read the paperwork right - I equity release and walk away).

I've got some questions that I'd love some thoughts on:

1) Will the creditors expect more than the 57p/£ agreed if there is sufficient equity?

2) Is it worth talking to my building society now (a good old fashioned mutual) with a view to offering a full and final settlement based on remortgaging? Is that even allowed?

3) My wonderful building society only offer remortgages at 80% LTV for debt consolidation. Do all IVAs have an 85% clause? (This is kinda linked to question 1 - 80% should be more than enough to cover my 57p/£ but if they want more I'll probably struggle to find someone to remortgage with - although having said that I'd only be looking for a 2X multiplier on salary).

4) Generally speaking, is the timing of the four year clause at the last review (i.e. 48 months) or at the 54 month mark that some people have mentioned?

Thanks in advance for your inputs.

"Stupid" Jon
- Alcohol and Wild, Wild Woman Got Me This Far...

[ivas4us]

welcome to the forum and I will do my best to help: -

1) yes I would think they would expect more than the 57p in the £.

2) I would ask your Ip thier view on a f&f.

3) you can only provide for the equity release clause if you are able to obtain a mortgage but what sometimes happens is that the IVA is extended by 12 months in leiu of equity release.

4)I think it depends on the wording of your IVA but 54 months seem to be a regular time period.

[plasticdaft]

What does it say in the proposal if you cannot release the equity?

[MelanieGiles]

The answers to your questions really do lie within the propsal documents, and from the good advice your own IP can give you with regard to the specific provisions of your individual case.

I think you will stuggle to get more than 75% LTV if you are in a current IVA, so that could work to your advantage if you can demonstrate that you cannot actually raise the equity monies required. Your IP may need to go back to creditors to seek their opinion, and this could result in you being asked to extend the IVA by a further year in lieu of the unavailable equity.