www.iva.co.uk

My usband is in month 40 of an iva, paying £264 a month.We have equity in our property
but are now on lower salaries than when we took out mortgage 10 years ago, so very little chance of us being able to remortgage after month 54 as stated in iva, so we will have to pay the iva for an additional 12 months. We had a third party who may be able to give us some money in order for this to come to an early completion . .but our IP said we would need to offer a minimum of £17,561 (as that is what the creditors would get in the event of bankruptcy) before he would even request a creditors meeting . . .but if we kept paying plus the extra 12 months the total they would get is £8712.Does this sound right to you ? Also, we ahve ajoint mortgage where we can draw funds against ( I am not named in the iva) Am I allowed to write myself a cheque against the mortgage as my half of the equity is not affected at all?
We are very keen to complete early as the stress of this having a terrible effect on us all. Any advice would be greatly appreciated , thanks

Hi and welcome.

No idea on that one - hopefully one of the experts will be able to advise later.

This is a very interesting point. We both have IVA`s and our mortgage has what`s called a "reserve" account which we used quite a lot prior to our IVA, but not since. When we got our last mortgage statement lo and behold there`s another £10k available on it.
We won`t attempt to draw on it though because at the end of the day you have to pay it back anyway, but it still begs the question.
My guess, and that`s all it is I`m afraid, is because it forms part of secured rather than insecured lending it falls outside the remit of the IVA.
I`d be interested to see any expert opinion.[?][?]

Hmmm -- although outside of the IVA as secured borrowing, my guess is that it would still constitute taking further credit. And, as the loan is joint, the party in the IVA will fall foul of the IP for taking unauthorised credit.

I think foggy is right, I'm surprised that the IP didn't inform your mortgage provider and they usually add a restriction on the property

Thanks all . . If we fall foul of iva by me writitng a cheque, I understand that is a breach . . but that we have some time to remedy it . .ie . . put the amount back into the mortgageTruly desperate times.

What is the money to be used for Desperado? I doubt that the mortgage company would allow you to do this, given that they are on notice of an IVA.

I have already written and cashed the cheque with no problem at all from mortgage lender. It is to pay off my debt now as been using cards to pay for food and fuel. We are both quite ill with the stress of this whilst trying to pay bills and feed two children . . but am now worried if this is against iva rules?

The IVA rules do not cover your share of the equity - but I would not make a habit of this - as the drawing of further funds against the mortgage does erode the equity given that you are viewed as a couple in the eyes of the mortgage company.

I would definately get your partner to advise their IP of this transaction.

Hi

As long as you are drawing no more than your share of the equity I can't see the problem as you are not part of the IVA.

Your husband has paid £10560 into his IVA so could you draw 7-8k against your share of the equity [if the repayments are affordable] and offer this to end your husbands IVA, or a third party offer the 7-8k.

Regards

Hi All, Thanks for all your comments.
He has paid in just over £12k so far as monthly payments have changed over the years ie; year 1 = £264 year 2 = £348, year 3 = £318 and this current year back to £264 again. His overall debts were approx £55k.
We have asked our IP what our options are in respect of completing this early but have been told the minimum would be to offer £17,561, as that would be what they would get in the event of bankruptcy (ie; my husbands share of the equity. Many Thanks

Sorry . . meant to ask . .so, do you think our IP advisor is correct in saying we need at least £17k plus in order to get out of this early? As I thought approx £8k would be enough?

I think that if the creditors would be expecting your husbands share of the equity (ie £17k) as part of the deal, then this has to be accounted for in any F&F offer, so your IP is saying that for a F&F offer to stand a chance of acceptance when you have no extenuating circumstances for finishing other than you just want it to be over, you need to offer the remaining months payments + the equity expected, or as near to that as possible.