my husband and i took out an iva in march 2009 after our debts spiralled out of control to over 56,000 this was caused by having loans to pay loans etc. we currently pay £300 for 5 years but recently found out by accident that after four years we could be forced to remortgage or sell our property to repay the debt. this was not explained to us by the company we took our iva out with who were recommended to us by the citizens advice bureau who we turned to in desperation. we have six monthly reviews and any extra money we have to pay. our main worry is this four or five year equity release clause.
we have a £65,000 mortgage our house was £130,000 five years ago but its now probably worth £110,000 which leaves an equity of approx £40/£45,000
is this true that after four years we will have to remortgage
will it be for the full outstanding debt prob about £40,000 or a % of it
will we be able to remortgage what happens if we cant
really worried as do not want to loose our home in 3 1/2 years time
can anyone give us any advice please
very worried and concerned
It is standard practise now to try and get a remortgage if you have equity in your property and this should have been explained to you and should have formed part of your proposal. Have you read through your proposal/chairmans report to see what it says?
If you can't get a remortgage (usually 85% LTV) then your IVA will normally continue for a further twelve months.
Which company are you using?
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
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Is your ability to remortgage based purely on LTV or do they consider your salary as well. I bought my property in the old days when lenders were willing to lend up to 5 times combined income. I believe lenders are rather more cautious these days and have reverted back to 2.5 times combined which may put the equity release scheme beyond most people.
hi
Company used is Griffin and King in walsall west midlands,
will they be asking for the full amount when we remortgage in the final year or just a percentage. i reckon we will still owe £40,000 when the five years is up
thanks for reply
This is an interesting post - especially given that I have just spent some time with the CAB who tell me that they deal with a lot of cases where clients have not fully understood the implications of a voluntary arrangement - but I've never heard this said about a firm recommended by CAB!
I do find it alarming that you say you found out about this "by accident". Was the requirement to remortgage included within your proposal - in which case you ought to have been aware, or made aware, of this prior to signing. Or was it a modification introduced by creditors at the creditors meeting - in which case your IP should have made sure you fully understood the implications of this prior to you deciding whether to continue with the IVA at that stage.
Given that you started off with the CAB - it may be sensible to take this issue back to them and explain why you have been so confused as to the treatment of your property. They may be able to investigate matters on your behalf, and perhaps you could look to an alternative solution if you are worried about how you can comply with the equity release clause.
Alternatively you could arrange to meet with your IP, to now have this explained to you more fully, you can ask them to show you evidence of your acceptance of these terms, and then decide on a plan as to how you can all deal with this matter.
