Devastated. They will take equity from my house. What are my options?

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juliette
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by juliette » Tue May 09, 2017 5:58 pm
Hi I'm absolutely devastated. I opt for an IVA to keep my house and so I can move after the final payment in June 2018. I was over joyed at my hard work of getting this paid in full. I now owe £3,200 great! But I've just been informed and I missed the clause in my agreement that they will take equity from my house. If I can by pure lucky find £3,200 to complete and finalize early can they still take equity?
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kravarran
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by kravarran » Tue May 09, 2017 6:19 pm
If you include the equity clause in any Full and Final payment request then it can be done but it depends on how much equity you have. Chances are that your IVA will be extended for an extra year to cover some of the equity so this would need to be considered when proposing any F&F for consideration.

Best thing to do would be to speak with your IP, but then you would be questioned as to how you would raise any F&F
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Foggy
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by Foggy » Tue May 09, 2017 6:28 pm
First of all -- read your equity release clause carefully -- it will explain what is what. You need to see if you trigger the clause ( if you have more than £5k equity ).

If you do you will be looking at a 12 month extension ( assuming it remains practically impossible to remortgage ).

If you make a F&F offer it will be based on your remaining payments multiplied by the monthly amount. If you are going to trigger the release clause you will have to add 12 payments to this. If you do not think you will trigger the clause you will have to prove it to your IP.
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Michael Peoples
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by Michael Peoples » Wed May 10, 2017 8:02 am
It seems like you are paying about £133 per month so I would think about £4,000 would be enough for creditors to close the IVA now. If you cannot raise this amount from family you could look at borrowing the funds elsewhere. However, it may be best to just let it run its course as your credit file will be badly damaged for six years from the start of the IVA. It may be difficult to move before this time period is up unless you do not want to buy again.
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Lisa Thomas
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by Lisa Thomas » Wed May 10, 2017 8:37 am
You could be worrying over nothing - the first thing to do is check whether the clause will check in and most standard clauses only apply if your equitable interest in the property is over £5k. Recommend you get a valuation so you establish this first.

Then consider your options - the norm is to extend your IVA for a year.

You might find this quick video I made useful:

https://www.youtube.com/edit?o=U&video_id=PHfc85n39U4
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