Release some house equity to pay for a court battle

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joanne957
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by joanne957 » Thu Jan 18, 2018 4:16 am
Hi I am currently in an iva that is due to end in November this year. Our house is shared ownership, 2003 home buy scheme, local authority own 25%, n we have to pay that back if we ever sell. I am wanting to release some equity to pay for a court battle regarding my late mothers estate, house is valued at 165k, mortgage is 53k, minus 25% for homebuy leaves our equity at about 70k, however I will also need to pay my iva off, I need permission from both parties to do either and I don't know if I can do so or how to get help. Iva balance was 26k, we have been paying £159 a mth for 51 months
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Foggy
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by Foggy » Thu Jan 18, 2018 8:02 am
Have you already extended the IVA in lieu of equity ? If not the IVA will be extended for another 12 months, or you might be asked to release equity anyway, by way of a remortgage ( which is unlikley to be able to be done ).

The majority of equity, if released, belongs to your creditors and will not be available for a court battle --- which brings another question ... your late mother's estate: If you have inherited or are in line to inherit anything, that, itself, could also be dragged into your IVA as a windfall.
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Ryan
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by Ryan » Thu Jan 18, 2018 8:28 am
Hi Joanne,

As Foggy says it is highly unlikely unfortunately that you would be able to re-mortgage until the IVA has Completed.

Regards
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Lisa Thomas
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by Lisa Thomas » Thu Jan 18, 2018 9:44 am
As the others state I think you may find your IVA has another 12 months to run plus any windfall will fall into the IVA. Take advice on this before you act.

You could put together a full and final offer on basis of voluntarily selling house and using funds equal to the remaining payments of c£3.4k to finish IVA early or get a third party gift to do something similar.

If you use third party funds to finish early with a view to you need to bear in mind that you credit rating will still be shot until the 6 year mark passes.
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