I believed I was entering the final 6 months (5 years in Nov 18) of my IVA arrangement. I have just been told that they seek equity release in my property or extend the term by a further 12 months. Other than offering a lump sum form a 3rd party, is there any other way to reduce or eliminate a further 12 months of payment?
I imagine I have over £5k equity however, I would expect it would be difficult to be accepted being in an IVA.
Do I have to arrange a valuation myself as I gathered my IP would do this from the letter?
I am also bought my house on a 'help to buy' scheme so only had to get a mortgage for 70% of the property and therefore only own 70%.
If you think there's a chance it might be less than that it is worth getting a valuation otherwise you may have to pay contributions and extend your IVA for another year unnecessarily.
The onus will be on you to provide a valuaiton - I wouldn't leave it up to the IP as theirs may not be as accurate.
andrew460 wrote:Thanks for your prompt replies. It states in the letter that if the equity in my property is over £5,000 (which I believe it is) then I must try to release ALL the equity in the property. Does this mean just enough for a full and final payment (i.e around £3.5k (estimated)) or will they take it all? Surely no one can get a re-mortgage if they are in an IVA. I am at a very confused crossroads at the moment and the IP is not very fast at replying to my concerns.
If you could remortgage (used to be possible and might be again one day) they would want all of the equity up to 85% LTV and up to the sum of the full original debt, fees and possible statutory interest. Currently you stand to get an extension.
andrew460 wrote:How many IVA's actually last 5 years (without any final payment etc.)? Seems like its just standard to extend it to 6 years. Is this the creditors decision or the IP's?
If you are a home owner it is pretty much "the thing" that it is extended, unless you can demonstrate less than £5k equity. Renters usually finish at the 5 year mark and a very few take early exit loans or secured lending to buy out the extension.
andrew460 wrote:Whose decision is it to extend it by 12 months? Can't imagine my IP fighting too hard for me.
It will be set out in proposal as a standard requirement, neither you nor the creditors and IP have any say --- the options have already been agreed: Remortgage if you can or extend if you can't.
See herefor my short video on the options:
None of my IVAs are Protocal term based so don't have the extra year clause. Many are based on 3 year periods to match what would be paid in Bankruptcy.
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