MY HUSBAND AND I BOTH HAVE IVAS WHICH HAVE BEEN RUNNING FOR 2 1/2 YEARS NOW. PART OF OUR AGREEMENT IS THAT AT THE END OF THE 5 YEARS WE RELEASE A TOTAL OF £10,000 EQUITY IN OUR HOUSE (5,000 EACH). WHAT HAPPENS IF HOUSE PRICES CONTINUE TO FALL AND WE DO NOT HAVE THAT AMOUNT OF EQUITY AT THE END OF OUR IVA?
It really depends on the actual wording of the proposal (i.e. there may be a clause in the proposals which says what should happen in the event that you cannot get a re-mortgage for £10,000).
If your proposal is silent on the matter, then the Supervisor of your IVA will be able to return to creditors and ask them to accept what they have had in monthly payments and forgo the money from equity release. You will not be the only people in this situation and your creditors are likely to be very sympathetic.
At worst they should be happy with a further 12 months payments from you.
Kind regards, Elizabeth Pywowarczuk, Insolvency Practitioner.
If you would like me to advise you about an IVA and if appropriate propose one for you, please visit my website at www.liberta.uk.com
