I am about to undergo an IVA .My biggest debt is with the bank I have mortgage with .The release of equity from my house is a cause of concern .Can somebody please elaborate how much equity would I be asked to release.
If my debts are around 30 thousand
How much is your house worth ?
How much is your mortgage for ?
Take the difference and this is the equity in your property .... If house worth more than mortgage then your iva proposal document should state what % of equity needs to be released. If unable to remortgage for this amount then a twelve month extension to the iva may be imposed.
If house is worth less than mortgage then negative equity exists and the likelihood is either your iva would end at year five.
Sharing from experiences of dealing with debt
There is a solution for everyone .... Just need to stay positive !
You would struggle to get a remortgage with most lenders while in an IVA so it is unlikely that if you do refinance it will be with your existing mortgage company. The equity release is usually capped at a maximum of 85% of the value of the property and you must raise a minimum of £5,000.
This should have been made clear to you by your IP firm so if you are unsure perhaps you should get a second opinion.
You may have to take out a secured loan rather than a remortgage in the final year so check this with the company concerned before going ahead so that there are no surprises
