Posted: Wed Jul 11, 2007 8:35 pm
My wife and I have been paying £540 into our IVA for 14 months. Original debt was £100,900 and following amendments to our original proposal equity release in year 4 has been included. Our property was bought for £137,500 in November 2004, approximate market value today £150,000? Only guessing though! Current outstanding mortgage is £129,780. Following our annual review and recent salary increases our IVA payments will increase to £860 next month. That was the background info now here is my dilemma:
Of the £100,900 debt, all of which was mine I had put approximately £40,000 into my wifes name with joint loans etc, she was not entirely sure of the financial situation until it really hit the fan and all came out. Fortunately for me she was very forgiving and even agreed to enter into the IVA and pay half. However following our annual review and recently finding out she can not have children she has become very depressed and is refusing to pay the extra and I can not afford to cover it myself. She says she would rather go bankrupt than pay over the extra cash for the next 4 years, bankruptcy is not good for me as I will not be able to continue in the job I do. What I would like to know is would it be possible to take out a secured loan from a lender who will lend to over and above the equity in the property and use this to offer our creditors a full and final settlement? I know it will be more exensive interest wise in the long term and I am unlikely to get a favourable rate bt if it is a possibility I could perhaps pay it off for 4-5 years and hope that the housing market continues to grow and then there may be more equity in the house which could be used to go toward repaying a secured loan.
Not sure how much I would need to offer bearing in mind there are 46 payments left at £860 which is £39,560 and I am not sure and can not see on my paper work how much of the equity I will be required to pay over in year 4, given the circumstances and the fact that bankcurpty might be my wifes preferred route and assuming I could get a loan do you think £40,000 would be in the ball park or would the creditors simply say it was not enough as they can expect close to £40k less fees plus the equity in year 4. Are they prepared to discount to get the cash now rather than in year 4?
Hope it makes sense, any advice would be greatly appreciated.
DM
Of the £100,900 debt, all of which was mine I had put approximately £40,000 into my wifes name with joint loans etc, she was not entirely sure of the financial situation until it really hit the fan and all came out. Fortunately for me she was very forgiving and even agreed to enter into the IVA and pay half. However following our annual review and recently finding out she can not have children she has become very depressed and is refusing to pay the extra and I can not afford to cover it myself. She says she would rather go bankrupt than pay over the extra cash for the next 4 years, bankruptcy is not good for me as I will not be able to continue in the job I do. What I would like to know is would it be possible to take out a secured loan from a lender who will lend to over and above the equity in the property and use this to offer our creditors a full and final settlement? I know it will be more exensive interest wise in the long term and I am unlikely to get a favourable rate bt if it is a possibility I could perhaps pay it off for 4-5 years and hope that the housing market continues to grow and then there may be more equity in the house which could be used to go toward repaying a secured loan.
Not sure how much I would need to offer bearing in mind there are 46 payments left at £860 which is £39,560 and I am not sure and can not see on my paper work how much of the equity I will be required to pay over in year 4, given the circumstances and the fact that bankcurpty might be my wifes preferred route and assuming I could get a loan do you think £40,000 would be in the ball park or would the creditors simply say it was not enough as they can expect close to £40k less fees plus the equity in year 4. Are they prepared to discount to get the cash now rather than in year 4?
Hope it makes sense, any advice would be greatly appreciated.
DM