Equity release

Get expert opinion. This is the place for new questions to be posted.
7 posts Page 1 of 1

lynda

User avatar
Posts: 5
Joined: Tue Nov 14, 2017 8:20 pm

Post by lynda » Wed Nov 28, 2018 5:29 pm
My IVA company wanted a valuation done on my property for the equity release I sent one in for the sum of 81,500 also sent in a redemption statement for the sum of 63,886.06 as to what we owe on the mortgage the IVA company say I have 3,237.00 to release I don't live in the property,my husband and I are separated could some one tell me if this calultion is right thanks x

Foggy

User avatar
Forum Expert
Posts: 28354
Joined: Fri Dec 17, 2010 11:14 am
Location: United Kingdom

Post by Foggy » Wed Nov 28, 2018 5:53 pm
There two methods in use. The most commonly accepted one would be:

Market value £81,500 x 85% = £69,275 less lending of £63886 leaves £5389 --- assuming 50/50 shares would leave your share of equity at £2694.50,which is below the £5k trigger so no release required.

The less common method (and, in my opinion, incorrect) is:

Market value £81,500 less lending of £63,886 = £17,614 x 85% = £14,971 divided by 2 = £7485

Although our figures are slightly adrift, they appear to be using the usual method and, asssuming you have the regular trigger clause, there should be no release or extension requires as the amount of equity (even by their figures ) is under the £5k trigger.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk

lynda

User avatar
Posts: 5
Joined: Tue Nov 14, 2017 8:20 pm

Post by lynda » Wed Nov 28, 2018 6:25 pm
Foggy wrote:
There two methods in use. The most commonly accepted one would be:

Market value £81,500 x 85% = £69,275 less lending of £63886 leaves £5389 --- assuming 50/50 shares would leave your share of equity at £2694.50,which is below the £5k trigger so no release required.

The less common method (and, in my opinion, incorrect) is:

Market value £81,500 less lending of £63,886 = £17,614 x 85% = £14,971 divided by 2 = £7485

Although our figures are slightly adrift, they appear to be using the usual method and, asssuming you have the regular trigger clause, there should be no release or extension requires as the amount of equity (even by their figures ) is under the £5k trigger.
Should I challenge the IVA company about this as I have already put a f&f offer to the for the sum of 3,000 thanks

Foggy

User avatar
Forum Expert
Posts: 28354
Joined: Fri Dec 17, 2010 11:14 am
Location: United Kingdom

Post by Foggy » Wed Nov 28, 2018 6:57 pm
I would first check the actual wording of the clause in your proposal --- then ask for details of their calculations and challenge if needs be.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk

Foggy

User avatar
Forum Expert
Posts: 28354
Joined: Fri Dec 17, 2010 11:14 am
Location: United Kingdom

Post by Foggy » Wed Nov 28, 2018 7:07 pm
If your firm is Aperture they will have used the latter (incorrect) method, which would be closer to their figures after allowances for redemption costs, which they do factor in. In the early days of them using this method they did back down when challenged, but are now not doing so. The clauses are badly written and, if intertpreted the way they now do, could be seen as correct -- albeit by twisting the original intention as indicated by the example calculations many proposals quote in full, or by reference to annexe 6 or 7.

As you will see the incorrect method gives better results for IP and creditors !!
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk

lynda

User avatar
Posts: 5
Joined: Tue Nov 14, 2017 8:20 pm

Post by lynda » Wed Nov 28, 2018 8:11 pm
Foggy wrote:
If your firm is Aperture they will have used the latter (incorrect) method, which would be closer to their figures after allowances for redemption costs, which they do factor in. In the early days of them using this method they did back down when challenged, but are now not doing so. The clauses are badly written and, if intertpreted the way they now do, could be seen as correct -- albeit by twisting the original intention as indicated by the example calculations many proposals quote in full, or by reference to annexe 6 or 7.

As you will see the incorrect method gives better results for IP and creditors !!
The firm is Aperture I submitted all this information 6 months ago when I made my last payment nothing was done untill now I have put f&f order into them on the 29th Oct 2018 aperture have told me it will be 10 weeks before a meeting to creditors is this normal thanks

Foggy

User avatar
Forum Expert
Posts: 28354
Joined: Fri Dec 17, 2010 11:14 am
Location: United Kingdom

Post by Foggy » Wed Nov 28, 2018 8:47 pm
lynda wrote:
Foggy wrote:
If your firm is Aperture they will have used the latter (incorrect) method, which would be closer to their figures after allowances for redemption costs, which they do factor in. In the early days of them using this method they did back down when challenged, but are now not doing so. The clauses are badly written and, if intertpreted the way they now do, could be seen as correct -- albeit by twisting the original intention as indicated by the example calculations many proposals quote in full, or by reference to annexe 6 or 7.

As you will see the incorrect method gives better results for IP and creditors !!
The firm is Aperture I submitted all this information 6 months ago when I made my last payment nothing was done untill now I have put f&f order into them on the 29th Oct 2018 aperture have told me it will be 10 weeks before a meeting to creditors is this normal thanks
The usual is 6 - 8 weeks from when they have all the information they need and Aperture always stretch timescales to the limit !
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk
7 posts Page 1 of 1
Return to “Ask IVA Forum and Industry experts”