At the end of the IVA (60 months) would you be expected to pay back the all of the remaining debt excluding or including the IP/IVA fees?
e.g debt £50k, IP/IVA fees £8K (total £58k). IVA payments 60 x £500 = £30K paid.
If you were capable through remortgage etc would you then be expected to pay back £20k or £28k
In principle Peter, if the terms of your IVA provided for a repayment in such manner, then the answer to your question is yes, however I think that you would find it difficult to source a mortgage with any lender if you have an IVA on record.
Basically Peter if you have a debt of £50k, and with fees it comes to £58k in total then that is what you will owe, so if you 'could' remortgage you would be expected to remortgage up to 85% of the value of the equity you hold, if this covered the £28k outstanding then that is what you would have to release, anything less and the remainder would be written off.
If you do repay creditors in full at the end of the IVA it will have been done with interest and charges stopped. Even if the IP fees are £8,000 this would be a lot less than the 2% per month charged by credit card companies.
True but I still have a good while to go and I am concerned that by the time comes some organisation like bank of Wonga will be offering remorgages at special interest rates and we will end up worse off
Peter. However you raise any equity at the end whether by remortgage or secured loan, your payments should not increase by more than 50% of what the IVA payments were. You should not be left worse off.
I was originally informed that the creditors do not always insist on a remortgage or the additional year and they sometimes let you off with the 60 payments assuming you have played ball and paid a substantial percentage off. Is that true?
It depends what your proposal states. Most say that you will attempt a remortgage and if there is equity you will release it up to a maximum of 85% loan to value. If you cannot raise the equity your IVA is extended by twelve months and if there is little or no equity the IVA ceases after five years.
You need to check your proposal and any creditor modifications.
Why a secured loan ??
Even if it is less than 50% of your iva payment, a secured loan could last 5 / 10 / 15 years ( or longer ).
Surely this can't be right !
Jeano, it is beginning to look as though future proposals will be worded this way. However, current ones are not ( generally). Although some even older ones, ending around now my have ambiguous clauses.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Looking at this from my own view point. Once out of the IVA I want to get it off the credit files and tidy those up and then hopefully sell my house, relocate and rent as I'm too old now for another mortgage. I would hope to break even or make a very small profit from my mortgage.
If future proposals included a secured loan I would be stuck for longer. Mind, I possibly wouldn't have agreed and found an altnative but just thinking the loan thing through. x
IVA final payment left the bank on the 26th January 2013...looking forward to a debt free future.
