Hi, I am 4 years into a 60 month IVA with payplan and have the usual equity release clause. My question is about offering a F&F before the property valuation is done. I think the first part of the calculation is easy i.e. number of remaining months until month 60 times the current payment amount. Do I then need to ad on the equity to be release amount shown on my original proposal (a relatively small amount) OR do I somehow need to take account of the increase in equity (given I have made a further 4 years mortgage payments) or do I need to assume my mortgage application will be declined and offer a further 12 months payments? Many thanks.
Hi Kadney I would suggest you seek some valuations now. This will give you an idea of whether there is any equity in your property and will give you a starting point to formulate your offer. I would then take into account any equity figure (if there is any) versus 12 months extra contributions and work out a figure somewhere in-between. Don't forget you can take into account the saving on administration costs etc when arriving at your settlement figure.
Assuming you have the £5000 de minimis allowance, if there is no equity or very little, you can assume no extension ( but you will need to back this up with figures). If there is an amount you are confident will be in excess of the £5000 then it is usual to add on 12 payments, on the assumption that the 12 month extension would be applied come the named hour.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
