No mention of 6 years in sale of IVA

[Bazza5070]

Hi, I took out an IVA back in 2007 and assumed I was in my 5th and final year, my IVA company have now asked me to apply to re-mortgage to pay the outstanding debt, I was under the impression this had to be done in the 4th not 5th year. I have been unable to obtain a re-mortgage and am now being told I have to continue paying for a further 12 months. At no point was I ever told about 6 years only 4 or 5. Have struggled to pay for the last 4 and a half years and the thought of an extra 12 is heartbreaking!!!! Is this info correct, I did find a site that said the rules changed in 2009, does this apply if the IVA was taken previous to this date?[V]

[MRBLUESKY]

Hi BAZZA and welcome to the forum,it is normal for a iva to be extended for a further 12 months for homeowners if they can,t re mortgage to release equity.Check your chairmans report to see if you have a equity clause in the terms and conditions.I assume you have equity,Try to keep positive, this is a set back if you wer,nt expecting it, but your nearly there 18 months isnt long, you.ve done well to get this far.If you are struggling you could inform your IP and ask for a reduction in your payments or even a payment break for a month.

[plasticdaft]

This really should have been made clear at the start because it is a very important part of an iva. Check your paperwork to keep yourself right.

Paul

[MRBLUESKY]

Totally agree Paul, Equty clauses are one of the most important conditions that should be made transparent at the start.

[kallis3]

This is an older IVA so it could be that there the wording of the equity clause is different.. There are a lot of people with older IVA's these days who are being expected to carry on.

There would have had to be a variation meeting though as far as I am aware though, it shouldn't just have been on the IP's say so so I would query that with them.

[Newspaperman]

I too was in the same boat. I knew about the £3600 additional funding that I had to try and inject into the IVA in year 4 but to no avail was I able to generate the money from a re-mortgage. Everywhere I turned to as soon as you mention your in an IVA the answers always the same sorry no we cant help. Its frustrating to think that I will be paying double the amount required over the next 12 months 60+1 in 11 to go

[kallis3]

I was under the impression that if it was less than £5000 then the 'de minimis' set in and the IVA would complete after the five years.

Have a word with your IP Andy.

[kat68]

i was also of the understanding that if the house value had less than 5000 pounds of equity the iva completed at 60 months, and even if it needs to be extended toa maximum of 72 months, then if the amount that would have been raised from the mortgage is reached by continuing regular iva payments in a lesser time, eg. say within 9 months then the iva will complete then.
but i do understand its all individual, and your answers will be in your proposal.
but do clarify with your IP.
i dont believe you should be paying more within the extension of payments, than you would have if been able to raise equity via remortgage.

[MRBLUESKY]

It does,nt seem fair if you could satisfy the £3600 over 6 months.Like Jan says i would query this.

[kallis3]

Check your proposal Newspaperman and see exactly what it says on there.

[Tina Shortland]

Hi Bazza5070 - unfortunately as the other have confirmed yes it is a common clasue within an IVA but should only be applied if it was included in your proposal that was signed off by the creditors. If it was and you missed it (although your company should have ensured you were clear about it) then it sounds like you may need an I&E review anyway for the final 12 months if it has been such a struggle. Speak to your IP.

Don't lose hope - I know you thought you were nearly at the finish line but you are still so much closer to the end than all those years ago. Hope you have a manageable budget set for the final year.

Regards,

[Bazza5070]

There is some small print in the original chairmans report that mentions 72 months and we must have missed it, but throughtout the same of the IVA there was only every mention of 4 years plus an extra 12 months if we could not re-mortgage, this was the big sticking point for us and the company went hell for leather to assure us that we probably wouldnt be about to remortgage anyway and so it would run for 5 years. One year into the IVA the IP was taken over by Grant Thornton and they were very vague when I called them in the 4th year to ask about the remortgage, feels like I was conned a little bit at the start and nobody from Grant Thornton wants to listen, maybe the best we can hope for is to plead hardship and hope that creditors will accept a lesser nominal payment for the final year. Thanks anyway for the replies.

[kallis3]

Bazza - GT post on the forum and I am sure Karol will pick up on this tomorrow but if not, click on the 'Ask a question' link on the left hand side of the page and you will find her details on there.

I hope you can get this sorted.

[Broke of London]

GT are a respected firm so I'm sure they are doing their best for you. It does seem strange they weren't interested in discussing the equity with you in year 4 but as you wouldn't have been able to reMortgage, you haven't been disadvantaged. The term would likely still have been 60 months extended to 72 to address the equity. Hope you can get some clarity and a difinitive answer soon so you can settle into the final few months. Congrats on getting so far x

[MrsKnight]

Hi bazza, I was with BE & transferred over to GT, we do have Karol from GT whom should pick this up or as kallis says you will find Karols details on the forum.

Im sure Karol will get this sorted out for you & it does sound like you need to go over a fresh income & expenditure, should your IVA need to continue, hang on In there.