www.iva.co.uk

Mortgage query - we are currently waiting for our creditors meeting date, we have 2 years left on our fixed rate mortage with Northern Rock but what will happen when the 2 yrs is up if we enter the IVA? Usually we would at that stage shop about for a better deal but I guess we wont be in a position to do that. So, what will we do? Will Northern Rock just put us ona variable standard rate? Will they take advantage of our situation and make us pay a high interest rate because we will be considered high risk? Or can they just force us to go elsewhere by demanding we find another lender? Wonder if all you guys already in your IVA's help with this one? What happened to your mortgage arrangements?

I imagine that Northern Rock will put you back onto their variable rate, and if you don't have much equity in the property at that time it will be nigh impossible to remortgage with anyone else. They will not force you to go elsewhere, but you may be penalised on interest rate due to a poor credit rating. Why not give them a call to ask these questions directly - they have a very good customer services department at their mortgage headquarters.

Mrs Moody

Melanie is right by saying you need to contact them.

They would not put you on a higher rate and take advantage because of the iva.There would normally be a reversion to their svr.

Melanie, Im a bit worried about talking to them at this crucial stage of the process, we have a large unsecured loan which with them, I did suggest to Payplan about me talking to them about changing to interest only, but PP suggested I just leave it to see what they want to do in regards to the mortgage at the creditors meeting. Was just worried we might be high & dry when the 2 years is up. Happy to move to svr for the remaining 3 yrs when the time comes. At the moment svr is cheaper than the fixed rate we are on anyway!

Mrs Moody dont be concerned about speaking to NR regarding your mortgage.

I have both a mortgage and £15k unsecured loan with Northern Rock and at a very early stage I wrote to NR and informed them of my plan to seek an IVA at the same time moving my mortgage to Interest Only.

They were no problem and well aware that I will eventually default on my unsecured loan.

If N Rock are a major creditor not only will you have to switch to interest only but your IVA will be extended to six years. Your payments will be subject to fluctuation for this whole period unless you can fix them when your current deal is up. N Rock may agree to this when your current deal expires or you can take your chances on the svr.

Good luck Mrs M - hope you manage to get something sorted.

Just to clarify that Northern Rock no longer ask their customers to revert to an interest only mortgage for the sake of it. I had this clarified by the bank last week. The interest only option is still used when identifying whether a case fits their acceptance criteria, however. So in this case, I would say that Payplan's advice has been correct.

OK thanks Melanie, and everyone else, think I'll just sit tight and leave it up to them to look at the proposal on D Day and decide whether they wish to make any changes to our mortgage arrangement. We didnt realise the loan we had with NR was infact un-secured and have been making payments in full alongside the mortgage so they probably dont even see a problem in the pipeline as yet!!