www.iva.co.uk

Confused about equity release. My IVA Comes to an end next July but I have an equity release to be sorted out. I know we won't be in a position of 15% loan to value so remortgage won't be an option. If I have to pay an extra 5K in the following year ( year 6) does this extend my IVA completion date and the effective date it will be removed from my credit file?

If your iva has a clause stating you must pay an extra 12 months in lieu of equity then yes it will extend the completion but it would be on file for 6 years anyway.

Paul

Hi Mark. Everything will depend upon the exact wording of your equity clause. But generally they go as follows: IN month 54 you will be requires to obtain a couple of valuations and a redemption statement. This will give you the equity figure, based upon 85% of the LTV.

If this equity is less than £5k the IVA will end as scheduled and the property will be excluded. If your share of the equity is more than £5k you will be required to attempt to release the equity ( which will be highly unlikely to be achievable). If unable to release equity the IVA will be extended by 12 months at the final monthly payment rate (NOT calculated to pay in £5k).

Removal from the credit files will take place either 6 years from the start date, or soon after the IVA is formally completed by the issue of the completion certificate, whichever is later.

That scares me ..another 12 months ......that would mean I will pay a lot more than 5K....that doesn't seem fair!

Oh and as it's a joint Iva and joint mortgage.....is that 5k each or in total?