www.iva.co.uk

Hi, we are currently on a 5 year fixed rate with NR that ends next January 7.9% interest rate(was a good rate at the time) after it ends we will be put onto their SVR and will prob be less than 7.9%, so what will happen if our repayments drop? Do we have to put all the difference into our IVA? And what then happens if the rate increases?
How do we get a remortgage in the 4th year to release equity if we need to,i dont think any bank will remortgage us while in the IVA,does anyone know the procedure?
Thanks.

Hi and welcome

You'll certainly have to pay some across but you may be able to keep some if your expenses have gone up. As and when it rises again then you'll have to speak to.your ip to have the payments lowered again.

As regards the temortgage, you are unlikely to be able to get one. You will have to.get a couple of rejection letters and there is a good chance your iva will just carry on for another year in lieu of the equity.

Check what it says in your paperwork.

Your IVA payments are a 2 way street,if your mortgage payment goes down your IVA contribution can go up(less extra expenses),and when the interest rate rises your IVA payment can be reduced. Just keep your IP informed. As for remortgaging its nigh on impossible for anyone to achieve,but your paperwork should inform you of what happens if equity cannot be released,normally 12 months extension of IVA payments in place of equity is required(often working out cheaper than a costly remortgage!!)

Paul

Northern Rock and NRAM's SVR is 4.79% at the moment so your repayments would definatley be less, hopefully their rate won't increase to nearly 8% over the next few months.

I have been lurking on lloydstsb's SVR of 2.5% for quite a while now,and need a 3.4% rise before it goes back to what I was paying before dropping onto the SVR!!!

I hope we are ok for a few more months.

Paul

I hope your rate stays like that Paul. With Halifax whacking their SVR rate up and being same stable as Lloyds, it might only be time before the rates go up.

I have been expecting a rate rise for ages as clearly LLoyds dont want people on 2.5% for long,but with each passing month I just feel like I am getting one over on the bank(they wanted me to switch onto a new deal 18 months ago!!).

I know they will win in the end though.

Paul

I'm just hoping that as NRAM have a higher SVR than other lenders that it will be a good while before there is any change.

just read this regarding my mortgage

Not all lenders can raise their SVR, as some have guarantees built into the terms and conditions.

Cheltenham & Gloucester, Lloyds TSB and Nationwide borrowers who pay a market-low 2.5% SVR will not see their rate rise unless the base rate jumps. Their rate is guaranteed to be within two percentage points of the base rate.

But not all of those lenders' customers enjoy 2.5% mortgages. C&G and Lloyds borrowers who took out a mortgage from 30 June 2010 will pay a 3.99% SVR. Nationwide customers who took out a home loan from 30 April 2009 will pay a 3.99% SVR.

I didnt realise that Lloyds were stuck with an SVR of no more than 2% above base rate!!!(for some customers).

I am a little bit happier now!!

Paul

Lucky you Paul. Stay where you are and do not be conned into a different deal.

I did wonder why TSB my biggest creditor were phoning up asking if I wanted a new mortgage deal!!!

Stick or twist,for now I shall stick. If the base rate stays low for 2 more years my credit file should be clear and I may just be able to get a normal rate mortgage!!!

I take it the banks raising their SVR's is because the BOE have hinted at no base rate change for the forseeable!!!

Paul

Paul

The cost of wholesale borrowing is higher than the .5% and many depositors are being paid more. There is also the fact that many people [inc luckily me] have lifetime tracker rates which costs the banks money but they cannot do anything about it. They pass their losses on to other clients.

Makes a change us being lucky with money!!!!

Paul

Hiya Debtdumb,

I am with NRAM and came off my fixed rate last year, prior to arranging our IVA. We are on the SVR at the moment, and hope that it will stay nice and low for the time being.

If their is any change you should always speak to you IP and let them know.