Selling my house during IVA

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Gokartbandit

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Post by Gokartbandit » Thu Aug 22, 2019 1:21 am
I got divorced 3 years ago and have a court judgment to remove my wife from the mortgage. This was supposed to happen on the 5th anniversary of my IVA I have applied for a mortgage but have been turned down.
I now have to sell the house.
My question is can I sell my house to a family member for just the amount of the outstanding mortgage meaning there would be no equity in the sale. I didn’t want to have to pay the £27k the IVA company are asking for to complete.

Foggy

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Post by Foggy » Thu Aug 22, 2019 8:23 am
Selling at an undervalue to deprive creditors of an asset can amount to fraud and, if the IP or creditors decide to act on it, could be reversed in the courts.

Have a word with Ryan or Shaun -- there might be a workaround available. They are both whole of market brokers with experience in adverse credit. Their contact details can be found in their profiles here:

Ryan: memberlist.php?mode=viewprofile&u=18488
Shaun: memberlist.php?mode=viewprofile&u=22837
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk

Lisa Thomas

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Post by Lisa Thomas » Thu Aug 22, 2019 8:31 am
Are you sure you have to sell the house? Usually an IVA is extended for one year if you can't remortgage.

Have you asked them for a settlement figure - is this why they have asked for £27k?
I'm a licensed IP with 16+ yrs at Neville & Co covering the South West area. I have a YouTube channel with advisory videos on here: https://www.youtube.com/channel/UCMPTTu ... Z5k9ZcC2MA http://www.nevilleco.co.uk 01752 786800 Lisa@nevilleco.co.uk

Shaun Vickery

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Post by Shaun Vickery » Thu Aug 22, 2019 8:46 am
Like Lisa, I'd like to understand why you say you have to sell the house...hopefully we can guide you a bit better from there.
Highly Commended at the British Mortgage Awards. For individual mortgage advice go to http://clients.theselectpartnership.co.uk/

Gokartbandit

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Post by Gokartbandit » Thu Aug 22, 2019 8:58 am
I have to sell the house because of my divorce, it was either get my ex removed from the mortgage or sell.
The £27k is the figure the IVA company gave me when I was looking to remortgage. So I would imagine that is how much they will want if I sell.

Shaun Vickery

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Post by Shaun Vickery » Thu Aug 22, 2019 9:12 am
Are you required to pay any money to your ex-wife?
Highly Commended at the British Mortgage Awards. For individual mortgage advice go to http://clients.theselectpartnership.co.uk/

Gokartbandit

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Post by Gokartbandit » Thu Aug 22, 2019 10:20 am
No I don’t have to pay any money to my ex she took my pension.
Had the IVA company told me the correct figure I would have to pay back if I remortgage in year 5 I would never have signed the agreement to remove my wife this year but would have agreed to remove her next year after the IVA.
Also I don’t understand how the IVA company came up with the figure £27k.
The amount I owed creditors was £24538 in 2014. I have paid £26843 into the IVA to date. £14565 has been paid back to the creditors that only leaves £10k left to pay off. The IVA company said the £27k included their fees.

Shaun Vickery

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Post by Shaun Vickery » Thu Aug 22, 2019 1:20 pm
It's quite possible that's correct because, if you settle in full, you would be required to repay the total debt plus your Supervisor's fees and possibly statutory interest. Don't forget the interest on the debts will have been frozen in the IVA. One option to consider would be whether you are able to raise funds from a re-mortgage to be able to offer to your creditors in 'full and final settlement'. Whether this is achievable will depend on your specific circumstances.
Highly Commended at the British Mortgage Awards. For individual mortgage advice go to http://clients.theselectpartnership.co.uk/

Foggy

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Post by Foggy » Thu Aug 22, 2019 1:49 pm
Following on from Shaun's reply -- read the wording in your proposal carefully, as in some I have seen that, where settlement is by way of equity release, statutory interest is not applied and in others ( as with mine) that statutory interest was excluded entirely.

I would ask for a breakdown of the figure they are requesting.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk

Gokartbandit

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Post by Gokartbandit » Thu Aug 22, 2019 4:12 pm
Thanks for the replies.
I have just spoken to IP about my release of equity because I found some info on another website which quotes a rule that you only have to remortgage to an amount that would not increase your mortgage repayments more than 50% of your monthly IVA payment ie I pay £110 a month so my mortgage payments would be an extra £55 a month this does not in anyway allow me to borrow an extra £27k more likely to be around £10k.
The IP said they have never heard of this rule and the creditors would ask for the full settlement.
Have I been given false info regarding this rule or is it actual fact.

Shaun Vickery

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Post by Shaun Vickery » Thu Aug 22, 2019 4:45 pm
It sounds like things are just confused. The rule you are talking about relates to an obligation you have to try to release equity from your property in the final year of your IVA. What we are talking about here is an EARLY settlement and therefore is entirely different.
Highly Commended at the British Mortgage Awards. For individual mortgage advice go to http://clients.theselectpartnership.co.uk/

Foggy

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Post by Foggy » Thu Aug 22, 2019 4:52 pm
Thu Aug 22, 2019 4:12 pmGokartbandit wrote:
Thanks for the replies.
I have just spoken to IP about my release of equity because I found some info on another website which quotes a rule that you only have to remortgage to an amount that would not increase your mortgage repayments more than 50% of your monthly IVA payment ie I pay £110 a month so my mortgage payments would be an extra £55 a month this does not in anyway allow me to borrow an extra £27k more likely to be around £10k.
The IP said they have never heard of this rule and the creditors would ask for the full settlement.
Have I been given false info regarding this rule or is it actual fact.
This is a standard rule, as per the agreed standard terms and conditions, along with time restrictions also. I find it unbelievable that your provider would not know of this --- who, may I ask, are you dealing with ?

These terms are contained at Section 9.3 and also within Annex 6 of the 2016 IVA Protocol.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk

Gokartbandit

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Post by Gokartbandit » Thu Aug 22, 2019 5:02 pm
Freeman Jones

Foggy

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Post by Foggy » Thu Aug 22, 2019 6:01 pm
Thu Aug 22, 2019 4:45 pmShaun Vickery wrote:
It sounds like things are just confused. The rule you are talking about relates to an obligation you have to try to release equity from your property in the final year of your IVA. What we are talking about here is an EARLY settlement and therefore is entirely different.
Good point, Shaun. Must admit, and apologise, I am getting confused myself !
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
http://foggy.blogs.iva.co.uk

Lisa Thomas

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Post by Lisa Thomas » Fri Aug 23, 2019 8:33 am
Thu Aug 22, 2019 10:20 amGokartbandit wrote:

Also I don’t understand how the IVA company came up with the figure £27k.
The amount I owed creditors was £24538 in 2014. I have paid £26843 into the IVA to date. £14565 has been paid back to the creditors that only leaves £10k left to pay off. The IVA company said the £27k included their fees.
£25k in 2014 add say 6 years of interest at 8% = £37k plus their costs (say 15%) = c£43k Less the £26k paid in to date = c£17k.

Ask them for a breakdown.
I'm a licensed IP with 16+ yrs at Neville & Co covering the South West area. I have a YouTube channel with advisory videos on here: https://www.youtube.com/channel/UCMPTTu ... Z5k9ZcC2MA http://www.nevilleco.co.uk 01752 786800 Lisa@nevilleco.co.uk
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