Confused about equity clause!

[atomicdev]

Hi,

I have offered to pay off my IVA with one lump sum coming from a third party. My IP said it was a good offer and would most likely be accepted. The total agreed amount to pay back was 15k and so far I have contributed 6.5k. The settlement offer I've made is 8k.

My question is this: What happens if I then decide to sell my house whilst waiting for the completion certificate (creditors meeting is taking place mid Jan) - do they get so much of my equity or what? I don't understand how all this works. Do they end up wanting more than the original 15k?? Please can someone clear this up for me thanks

[Michael Peoples]

A full and final settlem,ent usually means just that so no one can come back for more afterwards. However it may be better to put pressure on for the certificate before selling to avoid any complications.

[atomicdev]

Thanks for your reply and confirming this which is great as I was wondering if they could actually take part of my equity even after paying the settlement. I'm also presuming that if I did sell and the solicitor carries out any searches my property will come back as a charge against it? Who gets this removed and how soon, do you know? It is illegal for me to sell my property with a charge on it is that right?

[Michael Peoples]

There is a restriction placed a against the property which is removed when the IVA completes. It is not a charge as it has no value but even so a solicitor would be obliged to notify the I.P. if they were handling the sale.

Some firms close their IVAs down quickly and others are not so fast. Usually only then can the restriction be removed but if the full and final has been accepted the IP may do so beforehand.

[Foggy]

It will also depend upon the wording of the full and final settlement. Mine, for instance, merely proposed a moratorium on payments until such time as the arrangement was formally completed. This meant, in my case, that extra income by way of windfall or equity release would still be caught by the IVA, if these events occurred before I was issued with the certificate of completion.

We merrily use the term "Full and Final Settlement" when, in reality it neither full nor final until you get that certificate.

So -- check the wording !