Releasing Equity In The 4th Year

sillysausage1977

Can someone please give me some advice as to what happens when it comes to releasing equity in the 4th year whilst in an iva.

When it comes to trying to remortgage is it our choice as to who we approach to try and obtain a remortgage from or does the iva company stipulate who you go to?

Thanks

UpToMyNeckInIt

...It is usually up to you to approach some lenders - typically 2-3 dependent upon your IVA firm.

However, some IVA companies may also suggest other companies, and chances are you will be compelled to co-operate. This may especially be the case if you have significant equity, and a large disposable income - may be the case for IVA customers who have had significant salary increases throughout their plan (so not many I would guess).

If you are with DFD, they may also try making you release equity by way of secured loan (from what I have read, I believe that they are the only firm currently doing this).

The reality for the vast majority of IVA customers with equity (within the LTV85% and property valuation criteria) is that, regardless of how much you have, you are unlikely to get accepted for any sort of remortgage. In which case, if the available equity is less than £5K, you wont be expected to attempt remortgage in the first place, and your IVA concludes in Year 5.

If equity is more than 5K, you will usually be expected to ATTEMPT to remortgage, but you will most likely fail, in which case, the IVA goes on for a 6th Year.

The above advice is on the assumption you have a post-2008 protocol-compliant IVA, with no unusual terms imposed by draconian creditors (NRAM & HMRC for example).