Hello - I'm new here and wonder if anyone could offer any advice on my situation.
I'm 40 months into a joint IVA. A proposed remortgage in year 4 of our IVA was supposed to pay the lions share of our contribution to the IVA.
We owe £145,000 on the mortgage. Our house is probably valued at about £175,000 - £180,00 at the moment. (At the time of the IVA it was valued at £195,000 and assumed it would rise in value to around £210,00 leaving plenty of equity to release).
It doesn't take a genius to work out that there won't be much equity to release in year 4. And even if there was, is there really any chance that someone with an IVA will be offered a mortgage at the moment?
Does anyone know what will happen in this situation?
Hi and welcome
It is very unlikely that you will be able to obtain a mortgage and you will probably find that your creditors will ask you to exstend your IVA by twelve months instead of the equity release
Regards
In your experience would that be 12 months on top of the original 5 years (so 6 years in total)?
The amount that the creditors would get back from that would be a lot less than they would from a remortgage . . . can they take any kind of legal action?
Hi
Six years in total, yes
Your creditors can't make you sell your house but they could fail you IVA on nthe grounds that you can't introduce funds from your equity but they will not do this, there would be uproar in the insolvency market if creditors took this line
Regards
With regard to remortgaging, if you are unsuccessful in getting a remortgage, do you only have to try once before the 60 months have passed or can creditors request that you apply more than once before agreeing to an extra 12 months?
Just on this subject, I too have a 4th year equity release, but my IVA is already over 6 years...what would be my position if either their wasn't sufficient equity to release, or I couldn't get a 85% mortgage?
thanks
What if you don't have a protocol compliant IVA, say, self-employed? I read a post a while ago by Michael People who said words to the effect that if a creditor meeting had to be called at that stage they could force a sale of the property, especially of the debt had been sold on.
One of my modifications via KPMG stated that if the debtor is unable to access equity via remortgage the supervisor must convene a variation meeting to allow creditors to consider the debtor's proposed alternative offer.
However, another para states that if the amount is under £5k, 12 months additional contributions are required.
I was worried about that at the time but thought to myself, it's too far away to start worrying again.
7 year IVA completed in December 2016 - there is light at the end of that tunnel
HI
I worry about this as it is unlikely that we will be able to remortgage due to our ages. The equity was due to raise half of the amount I am to pay back. Are the creditors likely to be happy with just another year?
Linda
Hi Linda
Every case is unique so only your IP will be able to give you difinitive advice on this, as the equity release was a big part of your IVA offer the one year exstension may not be suitable for your creditors.
What did your IP say about this when drafting your proposal as they must have been aware that your age may stop you from a remortgage ?
Regards
Hi Andy
To be honest not to much was said about it. At the time I just wanted to get everything sorted out.
When I asked once about it they said it may be extended for another year but it was a bit vague and another time I was told I might have to sell. I do feel it is a grey area. I suppose I should really try to speak to my IP about it.
There is a pretty good chance that my salary will increase as I should be changing to full time as long as I pass my trial periodas I am being redeployed. If my contribution increases will this help my cause?
Many thanks
Linda
These questions about remortgage coming from the older IVAs have me wondering. Mine didn't say that we had to raise £n from the release of equity but that we had to release the amount available based on anything in excess of 80% LTV.
Am I right in thinking that it is part of the IVA protocol that proposals don't include a defined figure for release of equity anymore?
7 year IVA completed in December 2016 - there is light at the end of that tunnel
You mean 85% loan to value Cath. And yes - the IVA protocol introduced new criteria which did not require the equity value to be set at the outset of the IVA - but some creditors had been applying the 85% loan to value calculation for some time prior to the introduction of the protocol in any case.
