Hi, We are five years into the IVA and have just submitted our house valuation. Aperture have asked us to release £1,456.90 as a re-mortgage to take us up to 85% LTV. They have not included early mortgage repayment costs, which are over £3000. Should these be included in what we owe on the property? would this effect the amount they are requesting?
This does depend on the wording of the proposal as some say 85% of your 'equitable interest' must be raised and this does not mean loan to value. However if your proposal is standard and there is an early redemption penalty on the mortgage then this should be factored in when calculating any equity or extension.
Thank you for the reply. My IVA states LTV so I have emailed Aperture to ask if the fees should be included in their calculations. My mortgage advisor has told me that there is no equity to release at 85% LTV because of the fees required to re-mortgage. Would this mean that I will continue to pay the extra year into the IVA, or as there is no equity to release an additional year is not required? I am just very confused at the moment.
This depends on what fees are being talked about. If your broker is quoting a £3,000 fee or cost for the remortgage then this would be an expense to be deducted from the equity release [although it seems high]. If the £3,000 is an early redemption figure payable to your mortgage company then this would erode any equity and potentially leave you with less than necessary for the extension.
You need to find out what the fees relate to and then discuss this with your IP.
