www.iva.co.uk

My daughter and son in law entered in to. IVA a few years ago, it is now coming to the end of the five year period and have been contacted and asked for a valuation of their house to see how much equity is in it. My daughter is scared that they are going to loose their home and my son in law has just buried his head in the sand and says that will not happen,HELP do not know what to advise them

It should not happen! Tell them to dig out their paperwork and re-read the equity release clauses. If equity is under £5k there should be nothing more to do. If over £5k they must attempt to remortgage to release equity. This is currently impossible, so it is likely that there will be a 12 month extension on the IVA term instead.

This all does, however, depend on them having the relevant clauses in their IVA terms.

Which firm are they with ?

As foggy suggests it shouldn't be the case. If the equity clause is in it then they would have to have it valued etc. If equity exists it would be unlikely they would gain a mortgage increase for it or loan ...they may be asked to pay an additional 12 months of paymemts instead.
The original paperwork will inform them of what should happen.
Feel free to post further questions so we can support you further - I know first hand its a difficult time.

The worst case scenario is that if they have over £5k of equitable interest each then their IVA might be extended for 12 months.

Burying his head in the sand will not help - they need to get the valuation so the process can start of establishing whether the extension will be necessary.

Failure could result in a breach of the IVA, leading to failure, leading to potential Bankruptcy which could see them losing their house.

My daughter has signed a R1 form they are with Payplan

The RX1 just puts a restriction on the tile of the property, which, basically, will alert the IP if they attempt to sell without his consent. It will be removed when the IVA concludes.

They need to cooperate and get the valuation sorted.

I know nothing about IVA's so please bear with me if the questions I ask seem daft. If they have the IVA extended for another year what happens as their debt will still not be cleared off. At present I think they owe about £15,000 with the amount being repaid for another year they would only have reduced this amount by £1200, also reading other posts it seems to suggest that there are fees to be paid for taking out an IVA but they have not paid any, or is this added to the outstanding sum, if fees are due my daughter has no idea of the cost. Can I take this opportunity of thanking you for your help

Once the IVA is completed then any remaining debt is written off. There are fees but these are taken out of the monthly payments. They have nothing to worry about.

You only need to worry about fees if you manage to repay 100% of the original debt before the IVA has finished --- then you need to keep paying until fees are covered.

But, in the majority of cases, we only manage to pay an affordable proportion of the original debt ( fees come out of the monthly repayment (generally 15%)and anything unpaid, come the end, is written off.

I hope the above reassures you and you can pass this on to your daughter.

The house will be safe and how any equity is dealt with will lie within their proposal, so do advise her to check. All the best.

If the extension applies then after the 12 months is over their IVAs will be closed and any remaining debt will be written off.

Any IVA costs will come out of the asset realisations in the IVA estates so the creditors effectively pay for these as it reduces their dividends.