No equity & only 5mths left in IVA???

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mteegee
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by mteegee » Fri May 07, 2010 7:05 pm
Hi & hoping someone will be able to assist.
My husband I are in an IVA, which is due to end in Oct 2010, so 5mths left to run.
I am just sending back our payslips etc for the last 6mth review and I called my IP to confirm what happens between now & Oct 2010.
I have been dealing with a lady who has now left the company, so I spoke to a different lady who stated that the last payment is due 30th Sept 2010 & then they will issue the completion cert.
When we went into the IVA it was stated that
“The proposal provides for 60 months of payments of ****. It also provides for potential equity in the house to be released at the end of the arrangement”
I know that there is little or NO equity in the property, the estimated value of my property is £105k & mortgage of £43k & 2nd secured loan of £63k. So there willbe nothing for the creditors!.

When I mentioned this to the IP, she stated that we would need to get 2 valuations and then if there were any equity we would have to remortgage or if not equity we would have to extend the IVA for 12mths.
But at no time have we been told that if there were NO equity we would have to extend by 12mths.
I do have all my paperwork & annual repts from the iva. My iva company is Freeman Jones.

In my proposal to the creditors, it states: -
5.1
- 5.2.3 – I recognise the creditors will view the equity in our home as a valuable asset. We therefore propose to make a payment in to the arrangement in satisfaction of any claim by the supervisor or creditors to the equity. This payment can be made by a 3rd party, raised by way of a remortgage or by any other means. If necessary we will make the payment by way of continuing instalments after the 5th anniversary of the arrangement and the duration of the arrangement can be extended upto 12mths for this purpose.
- 5.2.4 – The amount of the payment will be for the maximum amount possible of the equity in the property, calculated by reference to a professional valuation carried out no more than 6mths before the calculation is made.
- <b>5.2.5 -If the property does not acquire any equity at all by the time this calculation is made then the supervisor will be able to release any interest in or claim to any equity in the property by himself or any of the creditors bound by the proposed arrangement upon payments by me of a nominal sum of £150.</b>
-

She said that she would spk to the Company IP and come back to us either today or tomorrow.

So what are the rules with regard to having no equity in the property?

- If there is no equity do we have to extend by 12mths?
- What does 5.2.5 mean – as it states if no equity is there they can release the interest in my property for a fee of £150?

Sorry this is a long post
Thank you in advance[?]

 

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Shining
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by Shining » Fri May 07, 2010 8:07 pm
Welcome to the forum.

Hi I'm not sure about the equity clause, I do know a lot of posters are required to pay the extra 12 months in lieu of the equity if they can't remortgage, but not sure what happens if there is no equity. One of our professionals will be along very soon.

 

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Cath
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by Cath » Fri May 07, 2010 8:38 pm
It sounds like that on receipt of the valuations, showing that there is no equity in the property, the IVA will conclude on the original end date. The £150 could be for Land Registry Fees.

An expert will be along to advise soon but hopefully your IP will get back to you quickly.

 

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MelanieGiles
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by MelanieGiles » Fri May 07, 2010 11:40 pm
That is ridiculous - £150 for what if there is no equity. And there are no HMLR charges to release a restriction. You cannot now avoid it as it is a contractual terms, but for the life of me I cannot understand why!

 

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millsy22
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by millsy22 » Sat May 08, 2010 7:41 am
hi we had no equity at the start of iva and still none at the end and our iva has finished just awaiting the cert of compliance and we havent been asked for £150

 

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mteegee
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by mteegee » Sat May 08, 2010 8:41 am
[8)]
<font color="purple"></font id="purple"><font size="3"></font id="size3"><font face="Tahoma"></font id="Tahoma">
So as my proposal does not say that if there is no equity they will extend by 12mths.
How could they make me extend by the 12mths for having not equity as we have never been told this before.
Thank you in advance
Clare[:I]

 

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kallis3
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by kallis3 » Sat May 08, 2010 8:49 am
What happens sometimes is that they call a variation meeting and creditors can extend if they wish.

Bear in mind that when you took your IVA out it would be assumed that you would have equity in your property, and then of course the bottom fell out of the market. Not your fault, but the creditors want their pound of flesh.

My own proposal allows for no equity, and if there is less than £5k then it will conclude after 60 months, otherwise it will continue for a further 12 months if I can't remortgage.

I hope it doesn't come to that, but you do need to speak to your IP to clarify exactly what is happening.

I think it's stupid you have to pay £150 as well!

 

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mteegee
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by mteegee » Sat May 08, 2010 9:04 am
<font color="purple"><font size="3"><font face="Tahoma">Thank you all

My IP should be ringing me on Monday after work (i'm a Mortgage underwriter, so it would not go down to well at work). If my emps new about the IVA i would not longer have my job :-(, so only our parents know about the IVA.
We have managed to keep it away from our work & friends which I am very pleased about as we are very proud people.

Many Thanks for your advise, I will post once i've spoken to my IP on Monday evening. My IP is Freeman Jones.
ClareXxxX </font id="Tahoma"></font id="size3"></font id="purple">

 

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MelanieGiles
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by MelanieGiles » Sat May 08, 2010 11:23 am
But your proposal does say that they can extend if there is equity for up to 12 months - see clause 5.2.3!

 

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mteegee
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by mteegee » Sat May 08, 2010 12:01 pm
<font color="purple"><font size="3"><font size="2"><font face="Tahoma">Yes that is right IF there is Equity. But, there is NO equity in the property.

So I want to know what they will do as the is NO Equity?
Sorry for any confusion
Clare[:I]
</font id="Tahoma"></font id="size2"></font id="size3"></font id="purple">

 

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MelanieGiles
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by MelanieGiles » Sat May 08, 2010 1:15 pm
If there is no equity the issue is irrelevant - no extension.

 

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mteegee
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by mteegee » Mon May 10, 2010 5:33 pm
<font color="purple"><font face="Tahoma">Afternoon
I have spoken to my IP & they have confirmed if no equity, i just have to pay the £150 to release us from the IVA.

So thank to all
5 mths & counting
Clare[:X]</font id="Tahoma"></font id="purple">

 

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kallis3
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by kallis3 » Mon May 10, 2010 6:03 pm
Excellent news, but I still think you should not have to pay a fee to end the IVA.

Good luck.

 

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Shining
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by Shining » Mon May 10, 2010 9:12 pm
good result and you're almost there x

 

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MelanieGiles
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by MelanieGiles » Tue May 11, 2010 1:36 am
Find out what the £150 is actually for. I have never heard of such a charge in my whole career!
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