Hi All, I am getting close to the end of my 4th year, as I own my own home I am expecting to have to remorgage, I have worked out (to the best of my ability) that by the end of the 4th year I will have paid back about 44% of the origional debt, according to my agreement the creditors agreed to receiving 34%, will I be forced to remorgage or could I opt to make payments for the 5th year? if I pay the same as I am paying now this will meen they will have received about 66%?
You will have to try and remortgage and if not then the chances are that you will have to continue for a further year in lieu of that equity which will mean that your IVA lasts for six years rather than five.
It means your creditors will get back a much better dividend.
An iva is usually for 5 years and equity in any home to be offered to the creditors at the end of this year! If mortgage payments increase due to the remortgage then your ip may ask for final closure! If the equity cannot be released then they can ask you to continue paying into the iva for a further 12 months making the length of the iva 72 months in total! This was what our agreement said so hope this helps
Hi TJ -- even if you achieve the proposed dividend you still carry on making the required monthly payments until the end of the term. The IVA doesn't stop when you hit this figure. Until the end you will always owe the total amount og the original debt.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
We have not known of anyone who has been able to remortgage for a long while so if your IVA is protocol compliant then you will probably have to continue for the final year.
As Foggy says, you will always owe the full amount originally owed plus fees until the end of the IVA.
Do you have any equity in your property? You will only need to attempt a remortgage(unlikely to actually happen) if you actually have equity to address. If you have equity then you will probably need to extend for 12 months.
If you have none then you should not have to extend the IVA and it should conclude as per the proposal.
The reply was not protocol dependant, the pure protocol IVA seems a bit of an elusive beast! either way you should never have to address equity you simply don't have.
Minimum dividend seems to have been taken care of so if there is equity then the only way to address it is to extend and if there's none then finish at term.
font size="1" face="Verdana, Arial, Helvetica">quote:<hr height="1" noshade>Originally posted by Ivoryfalcon
The reply was not protocol dependant, the pure protocol IVA seems a bit of an elusive beast! either way you should never have to address equity you simply don't have.
Minimum dividend seems to have been taken care of so if there is equity then the only way to address it is to extend and if there's none then finish at term.
Regards
You would like to think so, wouldn't you ?
However I have seen older proposals specify an amount to be released at the outset ( in the days of rocketting prices this was done to limit the equity payable, which was then expected to be ever increasing ). However, as we all now know, prices, and therefore equity, went rapidly south.
I have also seen cases where unhelpful IP's have refused to entertain variations to address this calamity and have insisted on the "contracual" amount specified in the proposal. Also cases where an extensiion has been imposed where no equity exisits.
It all boils down to what is in the original proposal or Chairman's report. Once THAT is known the question of introducing variations needs to be visited.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Very true Foggy, considered replies are much easier when we know what the proposal says. Perhaps the OP can give us a clue as to what the equity and proposal situation actually is.
I'm more than happy to assist, I went through the equity/no equity debate toward the end of my IVA(Very much non protocol) in 2010 and it's a right royal pain sometimes.
Hi Guys, my origional proposal does not mention any amount of equity has to be released, it states that the IVA will run for 5 years but at the end of the 4th year I have to try my best to release any equity in the house. If I am unsussessful in my aplication to release the equity then the IVA will run for the full 5 years.
In latter years, TJ, the industry and creditors got together to agree a model proposal, with standard terms and conditions. This they refer to as the Protocol, which has had a few updates since. This ensures some degree of consistancy, but is still, as you will see on the forum, open to differing interpretation.
Although a proposal these days is generally protocol compliant, they are, of course each amended slightly to suit individual circumstances.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
