Equity

[pippa]

Hi all

A query re the equity clause, I understand 85% of LTV equity release(I think) but what if you cannot afford to fund this amount of equity release in year 4/5. Would you then be forced to sell to allow the funds to be paid? My concern is that if house prices continue to rise, how can I be sure I will be able to remortgage the full 85 % equity release against my earnings, etc when the time comes.
(Hope this makes sense)

Pippa

[MelanieGiles]

Hi Pippa

If you were unable to fund the equity required to be raised by the proposal, you will need to discuss the implications of this with your IP at the time. I would suggest that you then consider proposing a variation to the original terms of the proposal based upon what you really can afford. In my experience, creditors are not really interested in your case at that stage - and you will have made four years worth of payments which will stand you in good stead for acceptance. You will, of course, have to justify why you cannot afford to pay the increased mortgage, as by this time you will not need to fund ongoing IVA contributions.

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

[pippa]

Thank you Melanie

Regards

Pippa