There is no definitive extension asked for in our original proposal.But we are being asked to write a letter agreeing to an extension. We have 2 payments left.
Here is the wording regarding equity release on my i.v.a.
In month 54 of my arrangement a valuation will be carried out on the property .
If that valuation shows that 85% of my interest in the value of the property is �5000 or less then i need contribute no more to the arrangement in respect of the property.
If that valuation shows 85% of my interest in the property is �5000 or more , I will seek to re-mortgage my share of the property subject to the following conditions:
The re-mortgage will be at a maximum of 85% of the value of the property.
The costs of the mortgage will be deducted from the mortgage proceeds.
The increased amount that i have to pay because of the re-mortgage will not exceed 50% of the monthly contribution to the arrangement.If the increased amount that i have to pay because the re-mortgage means the dividends to creditors falls below �50 per month after fees , monthly contributions are stopped and the i.v.a. is concluded.
We have tried to re-mortgage but have been declined.
We are being told that because of clause 1.15 they can enforce an extension.
Clause 1.15:
Creditors Meeting: As a general rule the supervisor will manage the arrangement, at his discretion, in the best interests of the debtor and the creditors. Should any circumstances arise where he feels the Creditors should be informed or consulted , a circular will be sent to all creditors. Should there be any significent changes to the original proposals, a variation meeting will be called and 28 days notice must be given.
There is no time scale given on the circular we are expected to sign and we are being pushed to write them a letter stating that we are offering to extend the i.v.a.
We are not being given any clear advice from the supervisor except sign the letter or you will be made bankrupt
I am sorry -- but that clause, as quoted, is extremely badly drafted.
It reads that the debtor must SEEK to re-mortgage and gives no provision for action if a remortgage is not forthcoming.
If if were in my proposal I would maintain that I have complied with the letter of the arrangement by seeking a remortgage and that is the end of the equity matter.
The IP is now seeking to cover his / her tracks with a variation which should have been written in and agreed in the first place.
As a compromise, for the smooth running of the IVA, and as a gesture of goodwill towards the creditors I might have agreed to a variation seeking to extend by 12 months, per current protocol ---- nut simply that --- no woolly wording and no threat of bankruptcy. The intention should be merely to bring the proposal back up to protocol.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
I know from experience of dealing with these situations that fear of the unknown and feeling out of control is the biggest issue for most people. It seems, as you say that they are relying on the catch-all clause and what's in the 'best interest of debtors and creditors'. I suppose you could take the view that you expected to have to release equity when you entered the arrangement and, whilst it's no fault of yours that you can't, it does play into your hands to a certain extent. A 12 month extension may not be that bad but if you prefer closure the alternative would be to consider raising funds with a secured loan and using this to offer a 'full and final' amount to settle the IVA now. If you did this you could look to settle it with a remortgage in 12 months time and your total mortgage at that point will be lower than it would have been had you been able to get the remortgage to satisfy the terms of your IVA now.
Specialist Mortgage Advisers. Highly Commended at the British Mortgage Awards.
