IVA, house sale and new mortgage

pilliepop

Hi All,

I'm two years into a 6 year IVA with Debt Free Direct. My ex husband and I still own a property together but we are discussing putting this on the market next year. The proceeds from the sale will clear my IVA and I will have a bit of cash left over. So my question is once I pay my full and final on the IVA, how easy (or difficult!) will it be afterwards for me to obtain a mortgage?

I won't have a huge amount for a deposit - approx £30k, so I'm looking at purchasing a small flat for renting out. Is it harder or easier to qualify for a buy to let mortgage once you've been in an IVA?

Would be grateful for any thoughts on this - thank you!

Also, incidentally - when I 'pay off' my IVA - are any of the payments I've made to DFD during the IVA taken off the balance?? The asset clause in my IVA paperwork says that 100% of the debt is to be repaid on the sale of the house PLUS their arrangement fee - however much this is!

I've spoken to them about early settlement, though I have no clue how I could come up with such an amount, but they've said that they would consider £8k to settle early (there's approx £25k worth of debt in the IVA). If somehow I managed to pay the £8k and settled early - but then sold my house at a later date, would they have any claim to my share of the house proceeds?

Apologies for all the questions - but thank you in advance for any advice!

foxy-stoat

pilliepop wrote: »

Hi All,

I'm two years into a 6 year IVA with Debt Free Direct. My ex husband and I still own a property together but we are discussing putting this on the market next year. The proceeds from the sale will clear my IVA and I will have a bit of cash left over. So my question is once I pay my full and final on the IVA, how easy (or difficult!) will it be afterwards for me to obtain a mortgage?

I won't have a huge amount for a deposit - approx £30k, so I'm looking at purchasing a small flat for renting out. Is it harder or easier to qualify for a buy to let mortgage once you've been in an IVA?

Would be grateful for any thoughts on this - thank you!

Also, incidentally - when I 'pay off' my IVA - are any of the payments I've made to DFD during the IVA taken off the balance?? The asset clause in my IVA paperwork says that 100% of the debt is to be repaid on the sale of the house PLUS their arrangement fee - however much this is!

I've spoken to them about early settlement, though I have no clue how I could come up with such an amount, but they've said that they would consider £8k to settle early (there's approx £25k worth of debt in the IVA). If somehow I managed to pay the £8k and settled early - but then sold my house at a later date, would they have any claim to my share of the house proceeds?

Apologies for all the questions - but thank you in advance for any advice!

You will find it harder to obtain a mortgage for sure, your deposit will need to be 25% of the purchase price - if you do not have a residental mortgage then you will unlikely be offered a BTL to buy a flat to rent out.

The "early settlement" you refer to is normally from gifted money, not from your assests.

I would look at your last annual review to see how much the fees are, you may want to postpone the sale of your asset until you have finished your IVA as any left over balance you think you will have may dissappear.

pilliepop

Thanks very much for your help. Mine is a complex case because the house is jointly owned by myself, my ex husband and his father. His father owns 50%, and we each own 25%. My IVA documents say that the property is excluded from the arrangement insomuch as to the possibility of a remortgage because of the ownership complication.

I guess - taking aside what money I might have leftover and what I decide to do with it - my main question is how much can DFD swipe if we sell the house?? Is it ONLY what I owe to my creditors plus DFD's fees, or can they take more?!

foxy-stoat

pilliepop wrote: »

I guess - taking aside what money I might have leftover and what I decide to do with it - my main question is how much can DFD swipe if we sell the house?? Is it ONLY what I owe to my creditors plus DFD's fees, or can they take more?!

Only how much you owe plus their fees. Their fees will probably be at least £10,000 but if you look on your last annual statement it will show their fees for that year.

FatManJohn

You will need to pay your creditors in full PLUS statutory interest at 8% per year PLUS DFD's fees PLUS DFD's disbursements PLUS any agents DFD have paid. Legal / agents etc