Ideas and advice about downsizing appreciated

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geoff412
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by geoff412 » Thu Dec 07, 2017 4:13 pm
Hi, I am considering selling my property to 'downsize' and clear mortgage and iva as I am struggling to keep up
Mortgage + secured amount totals £350000
House on market for £800000
IVA 3 years to go and I owe £9700
Ideas and advice will be appreciated
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Foggy
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by Foggy » Thu Dec 07, 2017 4:59 pm
When you say you "owe" £9.7k I assume you mean that this is the sum of payments still due --- does this include 12 extra payments for equity release ?

Now -- if you simply sell the IVA will take whatever is required to pay 100% of the original debt, plus fees and possible statutory interest (less what you have paid in so far) , up to 85% of your share of equity. The "workaround" is to approach your creditors (via your IP ) and say that you would consider selling in order to make a full and final offer of £XX (being the remaining payments -- including the extra 12) --- and that you would only sell if such an offer was accepted and if the offer were to be rejected the IVA would carry on as originally agreed. This would leave you the bulk of the equity to downsize with.
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geoff412
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by geoff412 » Thu Dec 07, 2017 5:36 pm
Foggy wrote:
When you say you "owe" £9.7k I assume you mean that this is the sum of payments still due --- does this include 12 extra payments for equity release ?

Now -- if you simply sell the IVA will take whatever is required to pay 100% of the original debt, plus fees and possible statutory interest (less what you have paid in so far) , up to 85% of your share of equity. The "workaround" is to approach your creditors (via your IP ) and say that you would consider selling in order to make a full and final offer of £XX (being the remaining payments -- including the extra 12) --- and that you would only sell if such an offer was accepted and if the offer were to be rejected the IVA would carry on as originally agreed. This would leave you the bulk of the equity to downsize with.


Thanks For the reply foggy

Yes 9.7k is the sum of the payments due,
So I would need to add 12 months @ £270 (£3270) to possibly make it a viable proposition?
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Foggy
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by Foggy » Thu Dec 07, 2017 5:43 pm
geoff412 wrote:
Foggy wrote:
When you say you "owe" £9.7k I assume you mean that this is the sum of payments still due --- does this include 12 extra payments for equity release ?

Now -- if you simply sell the IVA will take whatever is required to pay 100% of the original debt, plus fees and possible statutory interest (less what you have paid in so far) , up to 85% of your share of equity. The "workaround" is to approach your creditors (via your IP ) and say that you would consider selling in order to make a full and final offer of £XX (being the remaining payments -- including the extra 12) --- and that you would only sell if such an offer was accepted and if the offer were to be rejected the IVA would carry on as originally agreed. This would leave you the bulk of the equity to downsize with.


Thanks For the reply foggy

Yes 9.7k is the sum of the payments due,
So I would need to add 12 months @ £270 (£3270) to possibly make it a viable proposition?



Normally the lump sum can be rounded down a little to reflect the savings in administration costs made by creditors. But, when the creditors look at the amount of potential equity, they might feel less inclined to allow any reduction, so, yes, I would make the offer i.r.o £13k.
If you were, say, funding the F&F offer with third party funds ( from friends or relatives) an Offer of, say, £10k or £11k might be acceptable.
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luluj
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by luluj » Thu Dec 07, 2017 7:00 pm
With the level of equity creditors may also want statutory interest to be considered.
Sometime
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by Sometime » Sat Dec 09, 2017 8:25 am
The cleanest way to do this is get a secured loan, pay off IVA and when that has completed do what you want with your home.
Make sure the secured loan can be paid off early without penalty.
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Foggy
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by Foggy » Sat Dec 09, 2017 10:07 am
Sometime wrote:
The cleanest way to do this is get a secured loan, pay off IVA and when that has completed do what you want with your home.
Make sure the secured loan can be paid off early without penalty.


Whilst I agree with the principle, it is fraught with dangers unless handled carefully and in conjunction with the IP .... I know that Shaun Vickery, who posts on here, has a product which has been successfully used to this end in the past. Ryan Radford, another broker on forum, might also have access to suitable products.

Obtaining the loan has to be done in conjunction with the F&F offer -- if either gets refused mid strean, you are sunk! You would need to get an agreement for the loan, in principle, on the understanding it would only be drawn down for the F&F offer, if the offer is accepted .... then go in with the offer. If you just get the loan (which would be at eye watering rates) you have breached the terms of the IVA.

Have a word with Ryan or Shaun. Their details can be found under the "Quick Links" tab (top left) and then under "The Team" on the drop down --- they are towards the bottom of the list, in yellow.
Sometime
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by Sometime » Sat Dec 09, 2017 2:14 pm
Foggy wrote:
Sometime wrote:
The cleanest way to do this is get a secured loan, pay off IVA and when that has completed do what you want with your home.
Make sure the secured loan can be paid off early without penalty.


Whilst I agree with the principle, it is fraught with dangers unless handled carefully and in conjunction with the IP .... I know that Shaun Vickery, who posts on here, has a product which has been successfully used to this end in the past. Ryan Radford, another broker on forum, might also have access to suitable products.

Obtaining the loan has to be done in conjunction with the F&F offer -- if either gets refused mid strean, you are sunk! You would need to get an agreement for the loan, in principle, on the understanding it would only be drawn down for the F&F offer, if the offer is accepted .... then go in with the offer. If you just get the loan (which would be at eye watering rates) you have breached the terms of the IVA.

Have a word with Ryan or Shaun. Their details can be found under the "Quick Links" tab (top left) and then under "The Team" on the drop down --- they are towards the bottom of the list, in yellow.


Sorry, that is the route I meant. Ryan/Shaun can handle the whole process for you including making the F&F offer
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