iva update

Hi all,
I'm at month 54 in my IVA. Just waiting for my IP to contact me regarding remortgage/raising funds. I'm I right in thinking this is unlikely to be agreed due to my credit rating.

If so this will result in a further 12 months payments.

Also my income is about to drop by more than my iva payment.
I am hopeful that my income will increase again in the coming months.
My wife has some monies saved and we didn't know whether to use some of this to get to end of the iva has i'm worried the ip may start looking at the equity in my house.

Is it possible to offer the rest of the payments as a lump sum?

I'm thinking not as the projected return for the creditors was only about 20%.


Thanks in advance for any advice..

Comments

  • foxy-stoat
    foxy-stoat Posts: 6,879
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    Just sit tight until they come back at you. You can put an offer forward for a percentage of the remaining payments with new money outside of your normal budget as a full and final settlement.
  • Mermaid89
    Mermaid89 Posts: 107 Forumite
    If they haven't already done so, your IVA company will be asking for a mortgage statement/redemption figure from you (basically how much it would cost to pay the mortgage off).

    They will normally be interested in 85% of your homes value, and then they will deduct the mortgage redemption figure from the value plus any secured lending you may have against your home. This will then give your IVA company an equity figure, however if your home is jointly owned and it is only yourself on the IVA will they only be interested in your share (normally 50%)

    So it will be something like this:
    Home value = £100k
    LTV 85% = £85k
    Less mortgage £50k
    Available equity £35k
    50% share = 17,500

    It is the £17,500 in the above illustration that your IVA company is interested in and they will ask you to try and release those funds to pay your creditors. High street lenders will probably decline any kind of remortgage application so don't be surprised if your IVA company has employed some kind of third party to try and sell you the equity amount.

    *If* the third party (or a lender) CAN release funds it is up to you if you accept their product, but if you decline it (you don't like the repayment term for example) your IVA company will expect you to extend in lieu of the £17,500 not just 12 months. If the third party or lender CANNOT release funds on your behalf then it is normally a 12m extension unless someone can pay the 12m upfront for you.

    Hopefully that makes sense!
  • Thanks for the replies.

    Regarding equity my share will be approx. 35k, so it will have to come down to affordability. We still have just over 90k left on the mortgage with 15 yrs to run.

    It does state in my iva docs under,

    Release of Equity(net worth)
    I will also obtain two mortgage quotations from reputable brokers and/ or mortgage lenders. If my supervisor is satisfied that one of these quotations demonstrates that I am seeking to re-mortgage for the maximum achievable, I will accept and proceed with a re-mortgage in line with the higher of those quotations.


    I thought the "I" was just me an d not the IP sending a broker out!

    I Guess it will come down to affordability..

    Thanks again
  • Have they come back with anything? I'm keen to see how this has been resolved?
  • I would recommend being prompt with getting this sorted.

    Contact your IVA company and ask what documentation they require. It is likely you will need to send a mortgage statement and two valuations. Ring up a couple of estate agents (or even 3 so you can send the lowest two!) and say you are considering selling the house but would like a valuation to decide if it's right for you. When they come to value it explain you want a realistic figure for a quick sale to stop them overvaluing it to try and get your business!

    If you have equity you will be expected to contact your mortgage company and ask about a remortgage to release the funds required for your IVA (as your IVA company to confirm how much that is). It is highly likely they will say no, so ask them for this in writing and provide to your IVA company.

    Your payments will then extend for 12 months. Income reviews are probably not be required in this time but check with your IVA company. If they decide that a 12 month extension is required you could offer the creditors this amount as a lump sum from money offered by your wife as you want to finish the IVA and move on with your financial circs, plus you have reduced income which affects your ability to pay. They will likely accept as it doesn't change how much they will get (if six month income reviews are no longer required).
  • I would recommend being prompt with getting this sorted.

    I've emailed the IP twice earlier this week asking for a call back.

    Nothing yet
  • SIRENS
    SIRENS Posts: 1,229
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    Hi I'm not sure who your IP (mine is Payplan) is but my five years will be coming to an end in August, my IP contacted me just before Christmas and asked me for a redemption statement and a copy of my attached endowment valuation. They sent a valuer round to check the property (outside only). They then contacted me about 3 weeks later to say that as my current lender would not lend to anyone in an IVA that I would need to increase my payments in August by around £10 per month for an additional 12 months to complete my IVA. I'm happy with that.
    'You have brains in your head. You have feet in your shoes. You can steer yourself any direction you choose' - Dr Suess

    OS
  • Hi Sirens,
    Congrats on getting through it.

    Still no contact from my IP (Aperture previously Grant Thornton).

    My annual review is June but last year it was august and that was after chasing them. I spoke to them last august and they said someone would be in touch around Christmas time but nothing yet. I've tried ringing several times but after a long wait had to hang up.
    I'm not impressed with their service..
  • Hi all,

    I managed to speak to my IP this week, Updated them with my circumstances.
    They are sending out a I&E to complete.
    The said that Select Partnership would be calling me regarding release of equity and they have called today.

    A phone call is arranged for next week all they want is our income and a mortgage statement.
    Looking back at the original iva proposal it states

    Release of Equity(net worth)
    I will also obtain two mortgage quotations from reputable brokers and/ or mortgage lenders. If my supervisor is satisfied that one of these quotations demonstrates that I am seeking to re-mortgage for the maximum achievable, I will accept and proceed with a re-mortgage in line with the higher of those quotations.

    Can the ip just move the goal posts to suit themselves?
  • A further update,
    Spoke to the Select partnership regarding remortgage and after some initial details ie: incomes and mortgage details an advisor is calling back to do a affordability check.

    However I also spoke to my IP and expressed that it wasn't in my original agreement for a broker to approach me regarding the remortgage but for me to obtain 2 quotes from reputable mortgage lender/brokers. After a pause of silence and a splutter he said that if they made me an offer I didn't have to take it up but could just pay the extra 12 months in a lump sum if I can raise the cash. (suits me)!

    He put me on hold while he went to check with his manager then came back and said again I wouldn't have to take their offer.


    I hope the call was recorded...
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