Doing an equity release as a Full and Final ?

[sandee]

i recently suggested to my ip that i could do an equity release as a full and final for my creditors but they said this is not possible as they would consider it as disposing of my assetts? is this correct?
i thought they would prefer a lump sum now rather than a small amount for the next four years?

[Shining]

Hi, will bump this up for others to comment on as I'm not sure.

[Hyperdrive]

What do they mean by "disposing of my assets" Sandee?

[luluj]

My own personal opinion is you won't get an equity release approved anyway due to the IVA being on your file. I have recently helped a friend complete paperwork for equity release and they were asked if they were in or have ever been in a bankruptcy or IVA....the small print then mentioned that permission would have to be sought as there would be a restriction on the property stopping it to be sold or equity release if still currently in one.

This is just my personal view so let's keep it bumped up frone of the experts later.

[lem]

Wouldn't they be entitled to equity anyway as part of the iva along with monthly payments?

[MelanieGiles]

Do you have an offer of funding Sandee? If you do, there may be no problem in you offering an early settlement by doing this. Before the recession, a lot of people were using equity release as a way of concluding their IVAs at an early stage - but I do think you will find it difficult to find a lender, unless the money is coming from family or friends.

[sandee]

thanku to those who replied. to make things clearer-
i suggested to my ip that we put the house back into my partners name so he could do an equity release to pay my creditors (all through a solicitor) but they said that this would be disposing of an asset. i wondered whether they are saying this because they get 10% of all payments for the next four years?
we were told at the start of the iva that although it states we have to pay a lump sum at the end this is unlikely to come about because i have the credit status of a bankrupt

[MelanieGiles]

There may be nothing wrong in transferring the property to your partner's sole name, so long as the mortgage company will allow this - which is probably unlikely.

Try this in the first instance, and if they say yes come back and we can chat some more.

[sandee]

thanku melanie for your reply. there is no mortgage company we own it outright

[MelanieGiles]

What do the terms of your IVA require you to do with the property - is an equity release built in during the final year?

[sandee]

hi melanie

the agreement says i have to remortgage and give them
about £50000 due to the amount of equity in the property

[MelanieGiles]

Does it also say that if you cannot raise that sum of money you can simply extend the IVA for a further year?

[sandee]

hi melanie, yes it does say that but i cant see them accepting 12months at £350 instead of £50000?

another four years seems like a life time so we're continually trying to think of a way to pay them off so we can get on with our life

the reason the house would have to be put back into alans name is because i.m not old enough for an equity release but he is

thanks

sandee

[MelanieGiles]

If you cannot remortgage, they will have to accept the situation - after all it won't be your fault if you cannot find anyone to lend you the money.

[sandee]

thanku for all your help melanie.

if thats the case i would have thought they would be glad of a lump sum now