I have recently raised two questions on this forum regarding being forced to take out a secured loan in lieu of a remortgage to complete an IVA. The IVA is being managed by Debt Free Direct (DFD). The almost unanimous response that I received from the two posting was that I should not be forced to take out the secure loan. I have therefore gone back and queried the issue with DFD again and received the response that ‘in the current climate remortgages are not always viable and thus creditors have requested we attempt to raise funds via a secured loan. This directive has been passed via your supervisor as a result from meetings with creditors’. They have also stated that ‘it is at the discretion of your supervisor that you have done all that is necessary’.
My supervisor is clearly interpreting my Agreement to suit the creditors and not me. Who are DFD supposed to be representing? DFD are a member of DEMSA. On the DEMSA home page it is stated that ‘Debt management companies act on behalf of borrowers to help them to clear their debts’.
I have just also raised this issue with DEMSA and I am awaiting a response. Can anyone advise me of anyone else I can contact regarding this dispute with DFD.
IP's have two roles in an IVA -- at the preparation stage their duty is as Nominee to assist you, the debtor. Once the IVA is agreed they become Supervisor and their duty becomes that of maximising returns to the creditors within the terms and spirit of the IVA. IPs have varying interpretations of this duty!
Their interpretation will be limited by the wording in your proposal.
To make a complaint to their regulators go here to find out which body:
I concur with foggy but also add at the same time ensuring the debtor maintains a reasonable standard of living allowing for a review if income and expenditure on an annual basis to maximise the return to creditors.
Sharing from experiences of dealing with debt
There is a solution for everyone .... Just need to stay positive !
This is going to roll on and on because its something new. Have creditors really been asked by your ip if they would like you to take on a secured loan? Not sure I believe that this isn't just your iva firm trying to squeeze more out the cash cow err I mean customer! !
Paul
Discharged today the 8th feb 2012. View is much brighter now.
Continuing to rebuild our credit worthiness.
Under the remortgage rules you had to attempt to get 2 or 3 remortgage refusals so I assume its up to you who you try and get a secured loan from, so if you approached 3 creditors included in your iva and got refused by them all then what happens? Iva firms certainly shouldn't be acting as brokers to find loans!!
Paul
Discharged today the 8th feb 2012. View is much brighter now.
Continuing to rebuild our credit worthiness.
Absolutely disgraceful the way they are treating u , you have kept your end of the bargain and they should keep to theres . Your proposal im guessing is similar to mine if its an IVA protocol compliant one. Mine makes no mention of Secured loan whatsoever , it clearly states REMORTGAGE... And if unable an extension of 12 months payments ....
Im hoping it doesnt come to this as may be in same boat soon but If they force you to apply for a secured loan that you do not want,and which would see you in debt for a further 10-15 years then I personally would do everything in my power to maximise my chances of being rejected for this loan.
If I worked overtime then I'd stop before loan appllication submitted so cannot be used as income for incoming/outgoing purposes.
Make sure you fill out the Loan application forms yourself (or see it in full before signing). DO not let your IVA company/Loan Broker do the application withour you seeing it. This way you are satisfied that all the details of your appllication are legally correct ie income clearly shows your absolute basic pay (No OT) and is not exagerated, it states you are in an IVA and have BAD Credit, and it accurately shows outgoings etc and very importantly shows the true value of your house.
Call an estate agent/surveyor out for a true valuation of your home, not the price they advertise at!
When you ask for a valuation let the Agent know you are in an IVA and have no intention of selling at present, apologise for wasting there time and explain the reason for valuation (remortgage/secured loan) and tell them you need a valuation to the true selling price of property not the Rightmove advertised price! Tell them that the lower there estimate the better for you and point out all the flaws in the building, cracks, dampness, work needed, uneven floors,local crime etc! You will be surprised of the difference in the prices quoted and valuations recieved. There is nothing wrong with pointing out True facts to get the lower end of the valuation.
Some estate agents will value your house £20000-£40000 over the actual price to make it appear enticing to join with them to work as your agent. If they know the truth and that the lower the better for you they will give an honest valuation.
Hope this helps a little !
Last edited by Course on Sun Feb 03, 2013 8:57 pm, edited 1 time in total.
Valuations: Asking prices ( at least in the south west) are still 10 - 20 % over the prices actually paid ( which, by definition, is the value, NOT the asking price!). Most IP's use a forced sale valuation ( well those not in the creditors back pocket) which is about 85% of full market value ( and should be stipulated in your proposal. )
Again, if the proposal states REMORTGAGE and not just to raise by any means -- I would do everything in my power to get the IP to honour that --- not to do so would, in my mind, by a matter for their regulators to follow up. Complain details in my earlier post.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Thanks everyone again for the support and advice. I will get in touch with the regulators and certainly ask to see the secured loan application if I'm forced to take this route.
I am pleased to be able to advise that my story has a happy ending. On the advice that i received, i wrote to DEMSA who are a regulatory authority who DFD are members of. Although i only wrote to them for advice, DEMSA actually treated it as a complaint against DFD and contacted DFD. Although the outcome of the complaint was that DFD were seen to be acting properly, DFD changed their attitude and agreed to propose to my Creditors that i make a further 12 months worth of payments rather than taking out the secured loan over 15 years. This has subsequently been agreed by my creditors - something DFD originally stated would not happen.
I would therefore like to thank everyone for their advice but also their support and encouragement. I should now be clear of my debts in 1 year instaed of 15 years and i will end up paying 7.5 times less going forward.
That is EXCELLENT news Andy. I cannot fathom why DFD claimed the creditors would not accept something that is commonly used in most proposals and in the protocols to which they have signed up.
Well Done.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
