It's not 'ok' for me as you put it: It is a simple calculation, which is all relative. If someone is paying £300pcm into an IVA, they are deemd to be able to comfortably afford £150, if they are in a situation where after all their bills etc. they are paying £800 into the IVA, well then they can afford £400 on a loan.
Like I said, everyone's circumstances are different: I too, could well have uplifted IVA payments by then as well.
Everyone has to properly research their own circumstances and make the best of it.
Like you, I am no expert, and I can therefore only base examples on my situation and local knowledge.
The point is, as much as I too dislike the idea of these secured loans, I can see SOME situations where they could be considered a preferred option.
For example: Just consider what will happen when sub-prime mortgages become more widely availble to IVA customers (and you can bet they will at some point). IVA customers could be clamouring for secured loans then, as they could be the cheaper option, despite the interest rate. I just hope that this does not become the case in my IVA lifetime.
My opinions are just that: Based on my experience and being a self-employed IVA customer.
As I posted earlier, someone's level of affordability now may be considerably less in 5,10 or 15 years after signing up for one of these loans.
The affordability of any such loan is irrelevant to the point anyway,
The point being that these extortionate loans shouldn't even be a consideration when a debtor has signed up to an IVA without any knowledge they may have to take one out.
Last edited by Goosed on Wed Oct 30, 2013 6:55 pm, edited 1 time in total.
"When the seagulls follow the trawler, it is because they think sardines will be thrown into the sea".
When I, and the creditors, signed up to the IVA contract we both knew at year 5 it was either re mortgage and release £30k or 12 more payments. We both took a gamble me on in the hope no one would ever give me a re mortgage and them that someone would.
I feel no guilt whatsoever knowing that I will have to make 12 more payments in place of releasing equity in the same way that the creditors would loose no sleep if I did re mortgage.
If a secured loan is not fully detailed within your IVA and after 5 years the IP pushes you into one is that not a case of miss selling of the IVA on day 1??
Just a point on commissions earned by IP firms. Whilst this is something I would not do, there is nothing to stop an IP earning commission for a referral, however that money must be put into the IVA as an additional realisation which creditors then benefit from. The IP cannot pocket the commission, but is entitled to draw fees from that additional realisation - with full disclosure of this financial relationship between themselves and the loan company being disclosed to creditors and their client.
Just looking through my agreement and it states that
"On the expiry of 4 years from the date of commencement of the Arrangement and no later than 6 months before the intended completion of the arrangement I shall commence steps to effect a remortgage on my equitable interest."
I have not been given this opportunity, only been asked for a mortgage statement earlier this year.
It then goes on to say
"should a successful remortgage be achieved within the final year of the voluntary arrangement, in accordance with the terms of the proposal"
font size="1" face="Verdana, Arial, Helvetica">quote:<hr height="1" noshade>Originally posted by Rose68
Just looking through my agreement and it states that
"On the expiry of 4 years from the date of commencement of the Arrangement and no later than 6 months before the intended completion of the arrangement I shall commence steps to effect a remortgage on my equitable interest."
I have not been given this opportunity, only been asked for a mortgage statement earlier this year.
It then goes on to say
"should a successful remortgage be achieved within the final year of the voluntary arrangement, in accordance with the terms of the proposal"
Surely, this has been breached.
And, by the way, no mention of a secured loan.
I would assume they are taking the intended completion date of the arrangement as the end of year 5..
font size="1" face="Verdana, Arial, Helvetica">quote:<hr height="1" noshade>Originally posted by MelanieGiles
In what circumstances could an IP earn a fee for working with a secured loan broker?
Not sure Mel I don't know the specific arrangements available with secured loan brokers hence just asking the question, I was told once before on the forum that it was not possible for an IP to make a fee income from working with a PPI claims company either but there is at least one that has....
IPs that take commissions without declaring them and paying them into the IVAs under their supervision face regulatory penalties and potential loss of insolvency licenses. I doubt making a few pounds is worth any of that to be frank.
A loan taken out against your property has the end result of releasing equity.
But if it is classed as fee income then they are doing nothing wrong, guess its up to the IP's to determine what they class as fee income and commission.
If you take out a loan secured against your property does your mortgage lender have to agree it?
What would happen if you defaulted on the loan but had always made your mortgage payments?
