how would IVA affect my mortgage?

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Post by k.l.h » Wed Jul 28, 2010 11:25 am

I have approx £26k debt to 3 creditors.

I currently earn £37k (£2100 take home after pension and student loan). I am changing jobs and reducing my salary to £28k (approx £1500 take home after pension and student loan).

My husband earns £40k (approx £2300 after pension and car tax)

We have a joint mortgage and our joint expenses are £2k a month, with approx 18% equity in our property.

I am considering an IVA as I have been paying my debt at approx £700 a month, but am going to struggle when i reduce my salary.

My questions are about how this would affect my mortgage, as I understand that equity sometimes has to be released. I am also concerned as I dont want this to impact on my husband - will it affect his credit rating?



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Post by Datarecovery » Wed Jul 28, 2010 12:45 pm
An IVA mortgage is a mortgage designed for people who have entered into Individual Voluntary Arrangements to manage their debts. An IVA consists of reaching a payment arrangement with creditors. An IVA allows the debtor to pay a set sum towards repayments every month for up to five years. At the end of that time the debt is wiped out. Therefore it affects your mortgage.

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Post by kallis3 » Wed Jul 28, 2010 12:56 pm
My mortgage has not been affected. The company are aware of the IVA and as long as we continue our payments there is not a problem.

I do have to try and remortgage in month 54, but if I can't then I just carry on for a further twelve months.

k.i.h will probably have to try and remortgage from her half of the equity.
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Post by Adam Davies » Wed Jul 28, 2010 1:11 pm
If you have a joint account with your husband then there will be a financial link and this may mean that your husbands credit worthiness may be affected if you enter into an IVA
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Post by MelanieGiles » Wed Jul 28, 2010 11:29 pm
If you are suitable for an IVA - your husband will need to agree to you exploring a remortgage at the end of the IVA, providing you have equity based on a maximum 85% loan to value ratio. If this is right solution for you as a family, then I am sure he will be happy to help you.
Regards, Melanie Giles, Insolvency Practitioner


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Post by plasticdaft » Wed Jul 28, 2010 11:47 pm
Please be careful as it has been noted that some lenders(santander for one) at the end of any fixed rate mortgage will no longer put you onto a SVR but may instead put you onto a different rate for poor credit customers(regardless of whether your mortgage is up to date or not). This clearly has a cost impact,and switching mortgage providers is highly unlikely at this time.

Discharged today the 8th feb 2012. View is much brighter now.
Continuing to rebuild our credit worthiness.
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