Releasing equity

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ann374

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Post by ann374 » Wed Mar 25, 2020 6:19 am
I am in the 54th month of; IVA and am about to release equity to pay balance off, I was told that I would have to remortgage my house and would have to pay until I retire. None of this was mentioned at the beginning of the IVA. I was also having mental health issues when I agreed to this IVA which I told them about. I have never been given a figure of how much I needed to pay back, so how do I tell if it's been reduced by the 80% offered at the beginning. Like so many others I expected it to end at 6 years, was told I would not be a good candidate for remortgage as would be too old and would not be able to get loan due to IVA
Therefore it would be extended into 6 that year and then written off, now I have to have a second mortgage and will go to the grave never having had the security of knowing my house was paid for. If I was told this at the beginning I would never have gone ahead, I now will have another mortgage and if I all ill I risk losing everything. Please help me know what I can do

Foggy

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Post by Foggy » Wed Mar 25, 2020 8:11 am
First you need to see what equity is in the house. If less than £5k the clauses are not triggered. If more than £5k, you have to seek a remortgage --- this, in no way, means you will actually manage to get one. Note .. we are talking about a remortgage here ... not a secured loan, or second mortgage.

If your terms are based on the Protocol (as many are), what they can make you do depends on the version you have. It should say on the front sheet of your proposal. If your version is before 2014. the equity clause only requires an attempt at remortgaging. If after 2014 there will be the requirement to try a secured loan or second mortgage as well.

If you are not accepted for any refinancing the 12 month extension applies. If you are accepted for refinancing the amount you can raise will be limited by the amount you repay, which has to be less than half of your current IVA payment, and the term, which should be no longer than your current mortgage or retirement age, whichever comes last.
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

Foggy

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Post by Foggy » Wed Mar 25, 2020 8:13 am
Oh, and that promised 80% reduction on the debt is a marketing ploy. Whatever reduction worked out at the start is an estimate. The point of the IVA is to pay back what you can afford, so, if your income increases during the IVA, so does the amount you repay ( in simple terms).
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 » Wed Mar 25, 2020 11:33 am
Check your original proposals, terms and any modifications and they will likely have the equity clause in there.

This clause enables you to keep your home in an IVA but creditors to get something back for it, rather than you potentially losing it through the alternative of Bankruptcy.

Watch my short video here for more info on your options:

https://youtu.be/PHfc85n39U4

Assuming it all applies and you have more than £5k equitable interest then your IVA will probably be extended for 12 months contributions.
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

ann374

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Post by ann374 » Wed Mar 25, 2020 1:42 pm
I have more than £5k equity, and it looks like I have Aug 2014 proposal, if they make me remortgagewhy does it have to go on for 10 years, what if I have mental illness and end up going on the sick or have to give up work, how am I going to pay then.
If get secured loan will it be shorter time span, I can't go on as a nurse forever it's too stressful for body and mind, will that be taken into consideration ?

Foggy

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Post by Foggy » Wed Mar 25, 2020 2:22 pm
Have you already been offered a remortgage or secured loan ? If so, by whom ?
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

ann374

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Post by ann374 » Wed Mar 25, 2020 5:34 pm
It's under the The Select Partnership, she gathered information on Mon, am going to be assessed tomorrow morning for remortgage. Apparently they have 23 lenders, so I guess it's a done deal at god knows what rate of interest.
Do I actually get any say ?

kallis3

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Post by kallis3 » Wed Mar 25, 2020 5:54 pm
Select are usually pretty good and do post on here.
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.
Bob Marley.
http://kallis3.blogs.iva.co.uk

Foggy

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Post by Foggy » Wed Mar 25, 2020 6:25 pm
Wed Mar 25, 2020 5:34 pmann374 wrote:
It's under the The Select Partnership, she gathered information on Mon, am going to be assessed tomorrow morning for remortgage. Apparently they have 23 lenders, so I guess it's a done deal at god knows what rate of interest.
Do I actually get any say ?
No, you do not get any real say, but you might get a choice of loans to chose the one you prefer. Select are fair in what they do and will stick to the terms of your agreement.
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

Debtfreewannabe2022

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Post by Debtfreewannabe2022 » Wed Mar 25, 2020 7:04 pm
Well done for getting so close to the end of your IVA. It would be interesting and helpful for others, nearing the end that will find themselves in a similar situation, if you could share details of what kind of loan you are being offered, such as:
The term offered, the interest rate, If you are able to repay early without penalty etc.

Shaun Vickery

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Post by Shaun Vickery » Thu Mar 26, 2020 12:24 pm
Hi Ann. It is not necessarily that the loan HAS to be written over 10 years - determining factors will be what is affordable and what your own budget is - the higher the repayments the quicker it can be paid off and very often you will have the option to make over-payments. Obviously we have to put recommendations together in line with the terms of the proposal you made to your creditors at the outset but we will always tailor these to individual preferences etc. so that you receive the best advice possible. I should also point out that one of the good things included in the IVA is that the increase on your mortgage payments is limited to 50% of the IVA contribution it will replace. So, in response to the question over rate, ironically (and uniquely in this situation), very often a higher rate is good news! This is because it limits the amount of equity you have to release and therefore protects the rest for you! There are also many reasons why a second charge ('secured loan') may be more beneficial to you....too many to list here but these can be explained to you by an Adviser. If you would like me to look at your individual case please feel free to contact me off-line (my details are under the experts section on the left). My best advice is to keep your mind open and check your options, then you can make an informed decision and hopefully move on with your life.
Highly Commended at the British Mortgage Awards. For individual mortgage advice go to http://clients.theselectpartnership.co.uk/

Debtfreewannabe2022

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Post by Debtfreewannabe2022 » Thu Mar 26, 2020 1:16 pm
Shaun Vickery, very interesting to read about the various options and scenarios. Can you comment on whether your associated set up fees etc are added to the IVA and the Creditor accepts these fees, as per the IP associated fees, or is this added to the debtors ‘secured loan’ or remortgage, for example, for them to pay off.

Shaun Vickery

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Post by Shaun Vickery » Thu Mar 26, 2020 3:25 pm
In our calculations, any fees are deducted from the amount creditors are entitled to receive and therefore, whilst they are included in any new mortgage, are effectively not borne by the debtor. In most instances we pay any up-front third party costs incurred. This enables us to open up more options where debtors would not be in a position to pay them and which, by definition, means that we can be more flexible in our recommendations to clients and find a product which suits them best.
Highly Commended at the British Mortgage Awards. For individual mortgage advice go to http://clients.theselectpartnership.co.uk/

abbiesmum2003

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Post by abbiesmum2003 » Thu Mar 26, 2020 5:08 pm
To both poster and debtfreewannabe.....
I used Select about 18 months ago to sort equity release and complete our IVA after our contracted 60 months.
They were professional knowledgable and it was not the amount that I had envisaged (which was a lot based on our equity!!) simply because there are so many criterias for it to meet. It was alot lower than what I had expected.
They talked theough all options and we decided on best option for us.
We didnt have to do a secured loan due to our terms but we did as it meant not having to do the remortgage legal bits so a loan was more straight forward.
It was for a long term and high intetest however as its only for a short time in reallife, as we plan to move once things are settled, the loan will be paid off on our sale so although the figures of repayment over full term are monsterous we will never pay that as it will be repaid on sale. The early repayment on our product is only the equivalent of one month payment.

The monthly payment of any product, HAS to be half of your current IVA payment (you then only pay that, NOT that And fhe IVA payment) therefore giving you the other half as money in your pocket. That then restricts how much you can be lent by a lender so keeps it all under control.
The loan/remortgage gets approved, money sent to IVA company and IVA is paid and completed. You are then free once received the certificate.
Any fees are included in the figure of the loan, you dont pay anything upfront-unless there are any attached to a product you are offered but Select would discuss this if it cropped up.
Select would only recommend products that fit criteria and would be suitable and if none are suitable you pay an additional year into IVA then finish.
Best thing we ever did and life now is amazing. Money in the bank, money in savings, credit card with responsible limits which we pay and credit ratings ‘excellent’ across the board. All within 12 months of ending. It can be done. Trust Select to help.

Debtfreewannabe2022

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Post by Debtfreewannabe2022 » Thu Mar 26, 2020 10:22 pm
Thanks abbiesmum and Shaun. Very reassuring to know that.
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