I have a lot of equity in my house (about 60K) and am concerned that I will have to give all this up when it comes to the 54 month. Is there any way I can avoid this so I don't have to remortgage as the monthly repayments I would imagine may be quite high. My IVA payment is £120 a month and I have over £100 K of debt.
It is part of the standard provisions that you try to remortgage or release equity --- you can try to get this excluded from your arrangement but I sincerely doubt this would get accepted. Also this could run the risk of prompting the creditors to petition for bankruptcy.
The repayments you make on any remortgage are limited to 50% of the IVA payment, so £60 --- which will not release a great deal. The term of any new lending must not exceed the current term on the mortgage ot take you beyond state retirement age and there is also a ceiling limiting the lending, including current secured loans, to 85% LTV.
So, you won't be expected to surrender £60k of the equity.
Failure to get lending to release the equity will result in a 12 month extension.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Al.74 ... welcome to the forum. We are here to help so please update the thread with answers to questions asked so we can provide you with guidance and reassurance ...
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You could consider a small secured loan to close the IVA down as a remortgage would be very difficult or even impossible to source. It is possible that your IVA may just run for six yeras and you never have to release any equity but your own IP can advise on this. It will depend a lot on what was in the proposal and any modifications.
Thanks for all your advice. In answer to your questions, I own my house jointly with my husband who is also in the IVA. It was never suggested to us to release any equity at the start of the IVA, it would have probably been about 50 K then. How would the IP agree to a small remortgage to close the IVA when the debt is so high?
It depends on what was written into the proposal. Normally any remortgage cannot increase your monthly payments by more than 50% of the IVA payments regardless of the level of equity. Your own IP should be able to explain your obligations as it does depend on the individual case.
