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Hi,

I'm in the final year of a 5 year IVA and have been approached regarding the equity release clause of my agreement. The agreement was to seek a morgage in year 5 where equity exists in the porperty.

The IVA is in my name alone but I jointly own the property. Is my partner obliged to comply with my agreement?

Also I have been asked to take a secured loan rather than a mortgage as its cheaper but my partner will be required to be on the loan also. Will I fail my IVA if he doesn't comply?

I'm also going to have to cover the fees on the equity release loan - £1500 is this normal?

I feel like I'm being backed into a corner and don't know where to turn. I thought I would be persuing a remortgage independantly from my partner but this is not an option unless I want to transfer the whole mortgage onto a higher rate, which my partner will not do.

The loan I'm looking at will be based on a guestimate of equity by the broker and not a proper valuation. They are saying if I get a valuation and its lower than estimated, I can waiver the setup fee but the loan will be at a much higer rate.

Any help would be appreciated

Hi Honneyj, i was in exactly the same position as you a few months ago.

It really depends what it says in your agreement, but my wife and i knew what i was signing upto when we entered into the iva with regard to the equity release.

In my agreement it stated that we were to attempt to remortgage ,which at the appropriate time, we did by approaching three lenders who all turned us down therefore not able to remortgage. My IVA company then told me they could do a joint secured loan.

In my eyes, and my wifes, this is not what we signed upto and my wife stated she would refuse to sign the documents.

It does depend on your iva company and your supervisor, but they then approached creditors with a variation to extend for another 12 months.

We felt that we had fulfilled our obligations by attempting to remortgage and felt that we were being hoodwinked into taking out a secured loan as it was not in OUR best interests.

I wish you all the best in sorting this very important issue out.

Hi

The other owner of the property is not obliged to agree to a remortgage or a secured loan. Any secured loan should only be in your name, not joint

Regards

Thanks Andy,

This is the advice I am getting fromt the select partnership


Unfortunately as xxxxx is on the mortgage he will have to go on the secured loan, I did put it to the lenders to do it in your name but it was rejected.

It really matters not whose names are on the mortgage, if they are not in the IVA no one can make them sign or agree to anything irrespective of what they imply to you.

Would I fail my IVA if he didn't agree to the remortgage or secured loan, I would be willing to take this on in a single name so would be holding up my end of the agreement if I could get this agreed but I don't know where to go for advise on this.

I really feel its unfair on my partner to be asked to do this.

I don't know who would give me the best advice, the only person I am talking to about this at the mement are the select partnership who DFD have but me in contact with and even though DFD added the remortgage clause into my agreeement, the select partnership would charge me £1500 for nogotiating this as a full and final - I'm finding it all confusing.

The original proposal stated that on the expiry of 4 years from the date of commencement of the arrangement and no later than 6 months before the intended completion date, I shall commence steps to effect a remortgage of my equitable interest in xxxxxx (address). I will instruct an independant professional valuer to proovide me with a written valuation of such property. I will also obtain the outstanding balance of the mortgage. I will calculate the quity position in the property in order to help me establish my prosepects and cost effectiveness of seeking to obtain a remortgage. I shall provide all this information to my supervisor for jis consideration within 28 days of the date referred to above.

At no point do they mention a secured loan. My completion date is in September so I need to complete all requirements before 11th March (I think)

This has been argued before and DFD have no power or right to force a secured loan upon you if the proposal specifically refers to a "remortgage". They are not the same animal.

Does your proposal offer the usual 12 month extension in the event a remortgage cannot be effected ?

Yes it does, but I'm worried that if I don't seek toremortgage that I would fail as my husband won't extend the mortgage to longer than the current persiod or move the current balance onto a higher interest rate.

If I took the loandd and made the current payments I could repay it all in 21/2 years and close the IVA

Select Partnership are the firm that would be furnishing the secured loan, legally they have no say in your IVA. If your agreement states 12 in respect of equity due to not being able to re mortgage then DFD will have to put this as the variation to your creditors, who in most cases will agree to this. It is not in their interest to fail your IVA, DFD and their financial partner, Select Partnership, are trying to force your hand. Once your partners intentions of not signing anything to extend or amend the mortgage has sunk in to their thick money grabbing sculls then you will find that the 12 month extension will be put on the table.

Did your wife agree to the equity release clause when the IVA was set up to start with?

Hi mcgb. Its my husband (I'm the wife ) I can't remember him signing anything other thsn no sale over 5 year forms for land registry.