Can someone please explain the equity clause ?

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Tony.mac

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Post by Tony.mac » Sat Sep 06, 2014 6:25 am
Can someone please explain the equity clause. Our property was £185000, deposit of £22000 leaving mortgage of £163000. It is now only worth between £175000 - £17800 with secured loan of £32000.
 
 

Foggy

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Post by Foggy » Sat Sep 06, 2014 9:55 am
It depends on which version of the clause you have. But, if you have a mortgage in the region of £163k and a secured loan of £32k, you have a secured debt of £195k on a property worth £178k you are well into negative equity.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
 
 

Tony.mac

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Post by Tony.mac » Wed Sep 17, 2014 12:11 pm
Thanks Foggy for your reply. Our IVA proposal is the 85% to value. Would this be worked out as 85% of £178000 = approx £151000 less mortgage of £163000 and secured loan of £32000 = no equity, or is it worked out secured debt = £195000 and property is worth £178000 = no equity. Also we are in interlocking IVA's but told that £5000 clause is for both of us and not per applicant is this right although I have my own proposal and partner has his own proposal both stating £5000 equity clause ?
 
 

Michael Peoples

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Post by Michael Peoples » Wed Sep 17, 2014 12:43 pm
The equity is calculated against all the secured debt so it is kind of irrelevant about the £5,000 de minimis as you have negative equity anyway.
Michael Peoples | McCambridge Duffy Insolvency Practitioners
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