We're on month 65 of our IVA with Cleardebt.In our agreement(made on 19/4/2010)it states that"I will get two mortgage quotations from reputable brokers or mortgage lenders and then the standard wording of 85% LTVetc.We had around 15k of equity,so attempted to remortgage online,got screen rejections from 2 banks and sent them in.CD then contacted us in mid July saying the screen shot rejections were not sufficient,and we would need to contact a mortgage broker.We contacted one of the brokers on this forum,who helpfully gave us a confirmation letter that a mortgage could not be sourced.We thought that would complete proceedings and we would finish our last 7 payments without further stress,but have today received a letter from CD stating that"the Supervisor is required to assure that all avenues are explored in attempts to release your equity.Therefore we will refer your details to a third party organisation,Gateway Finance,who CD work closely with,and who specialise in assisting insolvent applicants with equity release options".We queried this with CD and they replied with "You have not met all the criteria as far as I can see, you were only able to provide one rejection.I can see you attempted online applications but what you provided for those did not confirm any personal details to show they were official rejections for you specifically. Also,the Supervisor has to be able to confirm all avenues have been explored and you fit the criteria for a Gateway referral(secured borrowing).We need to ensure that we have reviewed all options for you.This is likely to be secured borrowing in order to satisfy the equity release clause of your IVA".At no point in our agreements does it mention secured borrowing,only mortgage and remortgage.I have mailed them again stating this and await a reply.Has anyone else experienced this and what was your outcome? Is our interpretation that mortgage and secured lending are different,correct?If need be,is there anyway we could appeal this?
I agree that secured loaning and mortgage is completely different and a secured loan is likely inot a requirement of your IVA, the secured loan wording was introduced in the latest protocol. What does the wording of your IVA agreement say and which protocol is it bound by and I presume you have not agreed to some new protocols.
I'd be inclined to write to your provider (recorded delivery)stating what the IVA terms state as a requirement and the relevant extract from the protocol your IVA is bound by, you could also add that you are aware that the new IVA protocols do include secure lending requirements however you are not bound by those terms, as such their requirements are not in line with your IVA terms and unless they cease to try enforcing such terms you will be left with no option but to exhaust their complaints procedure and refer the matter to the regulators.
Last edited by longslog101 on Tue Aug 18, 2015 9:22 am, edited 1 time in total.
My Blog details, the route I took before IVA, how I choose my firm, equity release advice (year 4-5), challenging the CRA's keeping IVA on credit file once gone from insolvency register
IVA ended August 2015. Would recommend McCambridge Duffy
A remortgage is secured borrowing and perhaps this is all Cleardebt are doing. To meet the criteria they could be referring you to a broker but having already been refused elsewhere it is highly unlikely this firm will be able to do anything anyway. Hopefully they will not need to run any more searches as these are damaging to your credit file and by the sound of things you may not even need to extend.
The secured borrowing statement may only relate to remortgaging and not a secured loan but Cleardebt should be able to clarify this if you speak with them.
This is something that CD regularly do, and, to be fair, in some cases the figures for secured lending work out so that they are acceptable as an alternative to a further year on the IVA. In my view, you cannot be compelled to accept any secured lending, as your agreement states release by remortgage.
As said above remortgage and a secured loan are two different animals and the old terms do not compel the latter.
On the other side of the coin I feel CD are being rather pedantic and most IP's do accept the reality that a remortgage simply isn't going to happen at the moment.
There is no harm in seeing what figures this company come up with and politely declining, however.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Hi again, all. We have received a reply from David Mond. We have a clause in our agreement under the "Release of sums in lieu of equity" paragraph. His words are "As you will see, you are obliged to pursue all possible avenues to establish whether it is possible for you to release equity from your property into your IVA for the benefit of your creditors, who, in exchange, have agreed to write off a significant percentage of the debts due to them.If you are unable to obtain any re-finance through your own agencies, you should speak to Mark Love at Gateway, which is an organisation accustomed to dealing with re-finance applications from debtors who are subject to an IVA; if they cannot obtain any re-finance for you, then it’s fairly unlikely that you would obtain any re-financing of your property.This is a reasonable request from me as the Supervisor of your IVA, which could lead to a breach of your IVA if you fail to comply". I have already replied to him late on Tuesday asking to arrange a call and saying that nowhere in any shape or form and at no time has anyone mentioned secured lending in the last 5 years and that is this purely around interpretation of "third party"? I've not received a reply yet, but based on other posts on this forum, am I correct in saying that the agreement has to specifically state "secured lending" in order to be valid?
hi, I'm not sure of the wording and I maintain my stance on this albeit from someone who's been in an IVA and by no means an expert - we go into the IVA to become debt free, then at the end we're expected to take secure lending - doesn't sit right with me and never will.
I can see we may have to release equity etc., and I did agree to that within my proposal unless it was less than 5k which mine was so my IVA concluded but I would NOT have wanted to take any secure loans.
Again I state this is only my humble opinion
IVA final payment left the bank on the 26th January 2013...looking forward to a debt free future.
If it says mortgage quotations thenI would aassume that they would be what you need to provide and not loan quotations. Are Gateway offering a remortgage / mortgage or just a loan?
If you sent two quotations from reputable brokers as per the wording, I cannot see how they can now modify this to be a loan from their recommended broker.
Older agreements state that the equity release is to be by way of a remortgage or the introduction of third party funds, failing either, an extension is applied.
It has generally been accepted that the reference to third party funds means from friends and family, NOT secured lending. The new Protocols now specifically refer to secured lending, reinforcing the view that secured lending was not allowed for in earlier versions.
Yes, you are obliged to agree with a reasonable request from your IP. Personally I do not believe that further lending to get out of debt is reasonable, but that would be for a court to decide.
Up to now I have always considered Clear Debt and Mr Mond to be above the new money sucking stance that the bigger firms seem now to be taking and am disappointed that he and his firm have joined those ranks.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
That certainly wasn't discussed with me when I took mine out in 2009. I am so glad that we had no equity or ppi.
I knew the chances of having to remortgage were slim to none but at no point did someone mention taking out another loan. If that were possible, surely you're better doing it at the start and doing either a private arrangement with creditors or a one payment iva?
Thank you so much for your posts again. Knowing there is support out there from you guys does provide comfort even when possibly facing another decade or so of debt!
There has never been mention at anytime of a secured loan. When the IVA was sold to us all discussion took place around the remortgage, which we understood and were aware of. We haven't contacted Gateway yet as I'm still awaiting for a reply from David Mond, but it will be secured lending as that is what the adviser at CD told us.
I am unsure really what the difference is between remortgage and secured loan as remortgage is secured too. I think in my terms it said that the remortgage couldn't be more than half my iva payment and couldn't last longer than the term of my mortgage, is the product Gateway are offering complying with these terms if they are also in your iva?
If it is, I don't know where you would stand. I would be interested in Michael's professional opinion. It seems wrong but possibly legally it may be right.
Another IP has taken legal opinion and was advised that the secured loan and a re-mortgage were different animals.
In essence a remortgage is refinancing the whole mortgage which will remain as the first charge on the property. A secured loan is further lending against the property ( a stand alone loan)which is registered as a second, or subsequent charge, ranking behind the mortgage.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
