Started my iva exactly 5 years ago. As it was the final year my property was valued again and as there was not enough equity as per the agreement the iva was extended by a further year.
At the beginning of March I submitted a letter for full and final settlement of the exact amount of the additional 12 months payments to end on schedule at 5 years.
At the beginning of April I chased this up and was asked to provide additional information on where I was raising the funds to settle the iva.
As my parents are providing the funds i was able to provide this proof without issue.
I have been chasing my representative on this by email and by phone and to date the only response is it is waiting to go to the supervisor.
As a result I have just had to make my 1st payment of the additional 6th year.
My offer letter was to try to end the agreement at its original term and I am concerned my request is being ignored by the company managing the iva as they will continue to earn fees if the iva continues.
They are not ignoring you to gain fees - they will get those anyway from the settlement, and work less for them !
Why was there an extension because not enough equity ? This isn't usually the case, unless there was a specific reason written into your agreement. I suggest you check your paperwork on this point.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Thank you for your reply. The extension was down to not enough equity in the property. I did check the paper work and it does have a clause allowing the iva to be extended by 1 year if this is the case.
Can I just clarify you said as there was NOT enough equity in the property - but if there was less than the minimum (usually £5k) then an extension should NOT have applied.
You need to write to them by recorded delivery and demand an update. If you have given them everything they need, they have to call the variation meeting within either 21 or 28 days (check your terms).
Also when you write stipulate that any payments made in the meantime will be reduced from the lump sum.
Once you have a proper paper trail and receipt they have got your written letter you can them make a formal complaint if it becomes necessary to the Gateway.
Thank you both for your responses.
Sorry I should have been more specific with my information. IVA is with payplanplus. The difference in the valuation £87,000 at month 54 and my outstanding mortgage £72805.29 a difference of £14194.71 and they pointed me to this clause in the documentation
Equity: As can be seen in Appendix A the property at my address is solely owned. I estimate the current value of this property to be £98,000 which is based on a valuation by Zoopla.The mortgage is held by My Bank in the sum of £77,000.
For the purposes of my proposal, I have included an amount representing 85% of my current interest in the property.
In month 54 of my arrangement, (normally 6 months from the end of the arrangement) an open market valuation will be carried out on the property by an independent professional valuer.
If that valuation shows that 85% of my interest in the property (after deducting my share of the mortgage and/or secured loans referred to above) is less than £5,000 (net of all costs to take out a new mortgage) then I need contribute no more to the arrangement in respect of the property.
If that valuation shows that 85% of my interest in the value of the property (after deducting my share of the mortgage and/or secured loans referred to above) is £5,000 or more (net of all costs to take out a new mortgage loan), then I will seek to remortgage my interest in the property and introduce this money into the arrangement. However, the amount that I have to borrow and pay into the arrangement is subject to the following limits:
· The remortgage amount will be a maximum of 85% of my loan to value (LTV). · The incremental cost of the remortgage, including cost of any new repayment vehicle, will not exceed 50% of the monthly contribution at the review date. · The net worth released will not exceed 100p in the £ excluding statutory interest. · The remortgage term does not extend beyond the later of my State retirement age or the existing mortgage term. · The amount of the money introduced into the arrangement will be the mortgage proceeds less the costs of the remortgage, including any costs to redeem any existing mortgage and/or secured loan. · The increased amount that I have to pay because of the remortgage will be deducted from the remaining monthly contributions in the arrangement. · If the increased amount that I have to pay at any time following the remortgage means that the required contribution to the arrangement falls below £50 per month, monthly contributions are stopped, and the IVA is concluded.
I will provide a broker or prospective lender with my written consent authorising them to keep my Supervisor fully informed of progress throughout the re-mortgage process.
If I am unable to obtain a new mortgage, this will not be viewed as a failure to comply with the terms of the IVA and my Supervisor will have the discretion to consider accepting one of the following alternative proposals:
· A third party sum equivalent to 85% of my interest in the property, or · 12 additional monthly contributions (with the aggregate sum paid to the supervisor being limited to 85% of my interest in the property).
Ah -- all becomes clearer There IS equity in the property, enough to trigger the equity release, and you were unable to remortgage ( no surprise there) so had an extension instead.
Might I ask why you wish to end the arrangement early, other than the natural desire to end the thing and get on with your life ?
If it is to improve your credit rating sooner, this will not happen.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
I was not given the option to re-mortgage as they said I would be refused, so they invoked the additional 12 payments.
I just want to get on with life, I have managed for 5 years without any additional credit so looking forward to be done with the whole thing to be totally honest.
To be fair -- it is good that they took a sensible view on remortgage attempts. Most firms insist you humiliate yourself by trying, in the full knowledge that you will be refused. Just a pity they are now dragging their heels for no good reason.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
So how long should I give them to respond?
I sent the letter recorded delivery and it was delivered on the 17/05 but still no communication even to acknowledge the letter.
Thank you for any advise
Payplan are notoriously slow to respond -- it should say in your arrangement what time scales are appropriate for putting forward a variation ... but I would be chasing now.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Hi again.
The recorded delivery letter did the trick and they finally responded accepting my full and final offer.
I paid the money and to my surprise today I received a letter asking me to sign a letter allowing them access to any outstanding PPI claims before they issue the completion certificate.
As far as I am aware all have been claimed. My offer stated full & final, should I challenge this or just sign?
If you challenge this they will simply not issue a completion certificate until they are happy that all PPI has been dealt with. Regardless of the F&F PPI still belongs to the IVA.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
The other issue I have with this is it states they can set their own fees irrespective of any cap and must be allocated to the plan anytime in the future even after completion certificate is issued.
What they mean, I assume, is that the net refunds must be paid into the IVA, or the trust created by the IVA, after completion has been effected.
Fees for doing this would also be outside of the arrangement as this would have been completed, save the PPI issues, and would come from the refunds not from you.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
There IS equity in the property, enough to trigger the equity release, and you were unable to remortgage ( no surprise there) so had an extension instead.