securing previously unsecured debts on you home?

[s.d]

Is it true that once in an I.V.A any changes in your income must be reported to the I.P and they can actually increase your monthly repayment and take more money off you. Furthermore if an I.V.A is so strictly regulated, how can it be best practise to take equity out of your home to pay creditors thus securing previously unsecured debts on you home?

[Sadsack]

Hi s.d

Yes it is true that any changes in your financial circumstances must be reported to your IP. If your income increases, your payments will no doubt increase. And the same would apply if your income decreases, but this would be subject to your IP agreeing and perhaps extending the term of the IVA.

Releasing equity is a way to give your creditors as much of a return as possible. If you have £100k debt, generally speaking (and I am sure someone will correct me if I am wrong) you would only pay about 40% of that back. Based on your income, any surplus income that you have will be paid into the IVA and if it is insufficient to cover the minimum return, you would have to release equity by either remortgaging your property of selling your property. However, it would all depend on what is stipulated in your proposal.

I am sure one of the other experts will be along to advise.

Sue

Ho Hum! Think I'll bang my drum!

Read My Blog
http://sadsack.blogs.iva.co.uk/

[Adam Davies]

Hi s.d
You can't expect creditors to write of thousands of pounds of your debt whilst leaving you with thousands of pounds of equity in your house.
It is only fair to release an affordable amount of equity to repay some or all of your debt.
Remember in bankruptcy your house would be sold if it had equity in it.
An IVA is a fair vehicle for repaying your debts

Regards

Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

[MelanieGiles]

The fact that an IVA is strictly regulated has nothing to do with you making the best offer to your creditors by releasing equity. In simple terms, if you borrow money you find that you cannot repay, creditors will look to your assets to minimse their shortfall.

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

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp