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Hi I've been watching the forum and almost picked up the phone a couple of times! I think I understand the process. I'm worried about having to release equity from our home. It's in joint names (I wouldnt want my partner to know) and in addition to the mortgage we already have another secured loan. Does the terms of an IVA always state that equity has to be released and if so how does that work?

Hi juliem and welcome to the forum

Glad you are finding all of the posts useful and that this is making you consider your own financial future.

Can you tell us how much you actually owe to creditors, and is your partner aware of your debts? I am afraid that you will have to agree to an equity release provision during the final year of an IVA, and of course this will also need your partner's agreement at that time, so that could be tricky if you do not want to share your difficulties with him/her.

There are other options to an IVA, so post some more details and perhaps we can help. It would also be useful if you could confirm how much you feel you would be able to afford to pay each month.

I must admit that with the current state of the housing market, I'm not too keen on that clause either, but it's too late now !

Having said that, by the time year 4 comes around, there may not be any equity left to release - or at least enough to leave me with an 85% mortgage anyway.

MEL - is this an option - can they actually make you release equity and does this pay off the balance or can they demand that if you say, owed £3k balance and could release £5k, they would make you re mortgage for the higher amount ? I really don't want to extend my mortgage as there would still be 18 years left to pay on it and I'll be nearly 50 by then.

Hi
If you have an equity release clause then you must release the equity.The only way out of this i if you are unable to obtain a mortgage or your equity is less than 15%.
Under the new protocol if the amount to remortgage is less than 5k then you will not have to,also the increase in the new mortgage payments must not be more than 50% of your IVA payments.
If you refuse to remortgage yoyr IP could fail your IVA
Regards

Thanks Andy - we'll see when it gets to that stage ! There's a way to go yet.

What happens, in relation to equity release, if your income means you can't borrow anymore.

Hi
You will not have to remortgage,it would be because of affordability.
As long as you can show your IP that you have tried to remortgage then you have fulfilled your obligation and your IVA would conclude at the 60 month mark without a remortgage
Regards