Remortgaging as part of IVA

The_Money_Man

You do have to remember that the purpose of an IVA is to allow you to repay as much of the debt as you can reasonably afford and your creditors will have agreed your IVA on the basis that they are expecting you to release some of the equity in your house. That was always part of the deal although the exact conditions will vary from IVA to IVA.
Simply refusing to comply as mentioned previously in the thread isn't likely to be a good option because in many cases if the condition can't be satisfied then in the worst case scenario your IVA could fail altogether and that could be cutting off your nose to spite your face. If you are made bankrupt then you could lose your home.
At least find out what your options are and remember that if you got a remortgage as you agreed then it would probably mean paying a much higher rate on the whole of your mortgage. At least with a separate loan then it's only on a smaller amount and you may be able to remortgage in the future.
In any event there are various rules and criteria to ensure that any solution is reasonable and you may well be able to settle with your creditors for a lower amount than they (or you) originally expected.
There tends to be a lot of misinformation and wrong assumptions because people are understandably concerned about what is going to happen.
Talk to them and make sure you know all your options before you make a final decision.

immoral_angeluk

Who's your IVA company? As said above, the IVA will include a clause stating you should ATTEMPT to remortgage, but if you can't (which is unlikely) then you usually just have an additional year of payments.

win123

does anyone know how much you have to pay into an IVA on 20k worth of debt? I have a joint with my mum mortgage of 106k and would say the house is worth 125k -i earn 1049 per month and my household expenses with mort etc are 900? can i do an IVA at all or will i not have enough inome? I am on a dmp at the mo and its going to take 28 yrs to pay its making me ill but I am so scared that I will lose my home as my mum is disabled and we have had a council grant to adapt the home to her needs - so scared that we will end up on the streets especially in this day and age the way things are going
Thanks for the advice guys and good luck all with your IVAs

Foxy-Stoat_3

win123 wrote: »

does anyone know how much you have to pay into an IVA on 20k worth of debt? I have a joint with my mum mortgage of 106k and would say the house is worth 125k -i earn 1049 per month and my household expenses with mort etc are 900? can i do an IVA at all or will i not have enough inome? I am on a dmp at the mo and its going to take 28 yrs to pay its making me ill but I am so scared that I will lose my home as my mum is disabled and we have had a council grant to adapt the home to her needs - so scared that we will end up on the streets especially in this day and age the way things are going
Thanks for the advice guys and good luck all with your IVAs

I would start your own thread, but as a minimum I would be talking to an IP about your situation.

Most IVA's need to achieve at least 25% of the debt in 5 years. As you already have a mortgage you will be asked for another 12 months.

Hope this helps!

22cuddles

Thanks for the replies everybody. Am absolutely dreading a remortgage failure as I really don't want to have to keep paying for an extra 12 months. Really struggling as it is to make ends meet. I've worked out that if I complete my 60 payments without a remortgage I will have paid off 87% of what I originally owed. Paying a further 12 months on top of that will take me well over what I originally owed. I appreciate some of what I paid will go to the IP rather than creditors but I never expected to be paying more than I originally owed. Haven't heard back from the IP regarding remortgage yet but is it likely I'll have to keep on paying for a further 12 months.

Foxy-Stoat_3

All is not lost as by going on a IVA all interest would of stopped being added....so even if you pay the same or slightly more than you owed at the outset you would of saved 5 or 6 years worth of interest payments.

If your IVA was set up so that you would pay nearly 80% of your debt then maybe an IVA was the wrong road to go down but nothing can be done about it now.

Well done for getting this far tho!

Anondebtadvisor

If you can have to continue for another 12months you could, if possible borrow the money from friends/family to settle the IVA early.

How much are your monthly IVA payments?

sarah222

We had the same requirement we had toremortgage on month 48. Our house had to be independantly valued but the IVA paid for the valuation (I paid and that months DD was reduced by what I paid out!) It showed house was actually in neg equity. The IP went to creditors with details and it was agreed that clause would be removed and I would just carry on to month 60 without a remortgage or any extension. The creditors agreed Id lost out too!!! I made last payment to IVA yesterday and had the pleasure of cancelling the DD mandate on our bank account today :-)

Gimpsdad

A lot depends on the exact wording of a proposal, but a factor most seem to have overlooked in the whole equity release debate is that for protocol compliant IVA's you cannot take on any extra commitment that equates to more than 50% of the current IVA payment at the time. So, if a payment is £200, then you are limited to £100 as a repayment over and above any mortgage/secured loans you already have.

The £100 would then be deducted from the £200 for the remainder of the IVA payments. The total outlay remains the same. If that limits what you can raise then so be it.

In practice, very few can raise funds at present through equity release, so the extra year becomes the norm rather than the exception.

22cuddles

Interesting to read all the replies. Am still waiting to hear back from IP re potential remortgage. They confirmed receipt of my mortgage statement on the 17th of last month and said it would be about a month before I heard anything so hopefully not too long now. Having gone through my contract again they proposed £10,000 from a remortgage however, they had a PPI claim submitted on my behalf and I know that one company I'd had a loan with offered £6000 plus there was a few bits from a couple of other creditors (£30 from, £100 from another) and I'm hoping this might go some way towards making up that deficit if I can't remortgage.