At the end of the day, just as you are bound by the terms of the IVA, so are your creditors. Your IP cannot change the agreed terms without you and the creditors agreeing to accept that change.
The problem lies when the wording of your IVA does not state what will happen if you can't release equity, if there is a minimum dividend to be achieved, or if another clause or modification is messing things up or being too vague in what should happen when a 'remortgage' is not possible.
However if your IVA says nothing about "secured loans" being an option AND states that in the event you cannot remortgage you must extend for a year, I do not see how your IP can choose to ignore the terms that you and everyone else are bound by.
"Hope is the feeling you have that the feeling you have isn't permanent." - Jean Kerr
IVA approved Aug 2008 - 6 year term - last payment made 6 Oct 2014. CC received 14 Nov 2014.
A few years back it was then very clear to me that remortgaging on the 4th year of an iva was becoming impossible.(I don't believe any one has ever been able to do this who posted here.) Now it is Mission Impossible to remortgage and on an iva.
A very permanent very unforseen development in the iva framework and creditors/IP are reacting to this.
Like the PPI cliam in an iva, this iva loan demand has to go to judicial review as I know some IPs will/wouldn't enforce it.
Would chosing an iva firm now be tantamount to whether an ip enforces the iva loan demand?
Those taking an iva out need to think about this crucial point.
Must remember that IPs represent both debtor/creditors best interest and that balance is sometimes not achieved.
Obviously, no one would want to take the iva loan option if they cannot remortgage in the 4th year, but an IVA does cut your debt payback and creditors could argue that one still pays back less even forking out for that loan.
The Equity in the house could increase over the years to offset the iva loan so it isn't as bad as it looks to take out that loan?
Last edited by TzeKin on Mon Jun 16, 2014 11:40 am, edited 1 time in total.
Given that the loan would work out cheaper than a total remortgage there is definitely room for such a product. If some IPs refuse to implement the loan option creditors can simply modify the proposal anyway in line with the current protocol.
Once remortgages become more available which they will do more and more clients will opt for loans rather than switching their entire mortgage to sub prime rates and then it will just be a case of which is cheapest.
font size="1" face="Verdana, Arial, Helvetica">quote:<hr height="1" noshade>Originally posted by TzeKin
A few years back it was then very clear to me that remortgaging on the 4th year of an iva was becoming impossible.(I don't believe any one has ever been able to do this who posted here.) Now it is Mission Impossible to remortgage and on an iva.
A very permanent very unforseen development in the iva framework and creditors/IP are reacting to this.
Like the PPI cliam in an iva, this iva loan demand has to go to judicial review as I know some IPs will/wouldn't enforce it.
Would chosing an iva firm now be tantamount to whether an ip enforces the iva loan demand?
Those taking an iva out need to think about this crucial point.
Must remember that IPs represent both debtor/creditors best interest and that balance is sometimes not achieved.
Debt Lifeboat are clearly not representing my best interests and they never have. I haven't spoken to my IP in over 5 years, instead any issues are dircted to his 'team', who must be speaking to so many people they've had me at retirement age on a few occasions, and I'm 46.
He has made it clear that the creditors come first and they don't care how I release equity from my property, but if I don't, my IVA will fail.
Nowhere in the terms of my IVA does it indicate second charges or secured loans should be sought in the event that I (or Debt Lifeboat) are unable to arrange a remortgage. It simply says if I can't remortgage I should continue the repayments for up to a further 12 months. I would have ran a mile if the terms had stated that I should pay £264 x 60, then a further £131 x 180! But Debt Lifeboat think this is reasonable.
My IP did recognise that I've paid 58 payments on time but he said he would be unable to allow me to opt for the 'cheaper' method of a 12 month extention... even though I have this in black and white!
font size="1" face="Verdana, Arial, Helvetica">quote:<hr height="1" noshade>Originally posted by Michael Peoples
Given that the loan would work out cheaper than a total remortgage there is definitely room for such a product. If some IPs refuse to implement the loan option creditors can simply modify the proposal anyway in line with the current protocol.
Once remortgages become more available which they will do more and more clients will opt for loans rather than switching their entire mortgage to sub prime rates and then it will just be a case of which is cheapest.
Hi Michael,
So do you mean that the IVA I signed in 2009 (stating that if I can't remortgage I must pay an extra 12 months) can just be modified at any time to include secured loans or whatever else the creditors see fit?
Hi Blackstar. I am referring to cases going forward and not to older ones. If you believe that you are entitled to the extension perhaps legal opinion may be useful but I cannot comment on your exact proposal as I do not know what it says or what modifications were proposed.
It can be a breach to refuse any 'reasonable' request of the IP so there is an argument here as to what is 'reasonable'. I personally would not want to prejudge what a judge or regulator would say so hopefully you can sort this out with your IP.
The problem here is Michael, Debt Lifeboat does know what the proposal says and I cannot imagine them terminating the IVA unless they are sure they are within their rights to do so,can you imagine the reprocussions if they are wrong,surely they will had legal opinion on this, Blackstar will not be the only client this has happened to, a very worrying time for the poster I am certain
font size="1" face="Verdana, Arial, Helvetica">quote:<hr height="1" noshade>Originally posted by Michael Peoples
Hi Blackstar. I am referring to cases going forward and not to older ones. If you believe that you are entitled to the extension perhaps legal opinion may be useful but I cannot comment on your exact proposal as I do not know what it says or what modifications were proposed.
It can be a breach to refuse any 'reasonable' request of the IP so there is an argument here as to what is 'reasonable'. I personally would not want to prejudge what a judge or regulator would say so hopefully you can sort this out with your IP.
Thanks Michael. I think the fact that the loan offered was to run beyond the term of my mortgage by almost 3 years is unreasonable and, as some have pointed out, may be against protocol.
It is not unheard of for an IP (even a supposedly reputable one) to threaten to make you bankrupt in order to force you to comply with their request.
There are a couple of really helpful and knowledgeable experts on this forum. If they are not able to answer your questions then you have the option to seek legal advice, sign up to the loan or be prepared to defend the threat of a bankruptcy petition by your IP.
Whilst there are no guarantees, it would be a harsh judge that would make you bankrupt after you have:
Paid your contributions for 5 years.
Proved that you have tried, and failed to get a re-mortgage.
Have offered to pay an additional 12 month payments as per your original terms (I presume?)
From the brief details that you have provided, I would argue that you have not refused any 'reasonable' request, but that is only my personal view.
7 years after starting an IVA I finally received a completion certificate from ClearDebt
Guys - this is all very simple. What does the contract say? If the contract is silent on the taking of a secured loan, then it cannot be enforced. I have the benefit of Counsel's opinion on this - which states that a secured loan and a re-mortgage are entirely different processes - and unless the IVA contract provides for the taking of a secured loan then I cannot see how the IP can force this upon their client, nor how an IVA can be failed if the debtor refuses to take one out.
Thanks Melanie . . That is very helpful and interesting as i was informed today by IP s right hand man that a secured loan amd a remortgage are the same thing! That we had no choice but to accept the loan offered or risk bankruptcy. . .or.. . Raise funds from a third party . . Should we seek legal advice now?
I think that you need to get them to commit their reasoning to paper, and explain to you exactly what their position is - and then yes, if you really do object to being pressurised to accept a loan that you don't feel that you need to, then legal advice would be very sensible - and ask that this be paid for from the estate funds.
What happened with this? I'm in the same boat now or about to be. They just refused FF offer and re-mortgage not possible although a lot of equity in the house.
It very much depends on the wording of your agreement. And even then on your and their interpretation of that agreement.
If your IVA terms state remortgage then it should only be a remortgage!
Hopefully one of the experts or someone with more up to date knowledge can add to this?
The original thread was from a year ago, and at that time, I don't think an IP would have risked trying to bankrupt somebody who had followed the terms of their IVA, made all payments and followed all reasonable instructions. Not sure if that has changed in the last year or not?
7 years after starting an IVA I finally received a completion certificate from ClearDebt
Unles you have signed and agreed to be bound by the new protocols which include secure loan then you don't have to take out such a product, a mortgage is a form of a secured loan, bit secured loans could also be ridiculous loans with stupidly high interest rates, check to see what your agreement says and what your protocols your agreement is bound by.
I too would love to know what happened with the original posters question and the outcome, another fine example of a company taking the p!$$ and one to avoid if ever looking for an IVA......
My Blog details, the route I took before IVA, how I choose my firm, equity release advice (year 4-5), challenging the CRA's keeping IVA on credit file once gone from insolvency register
IVA ended August 2015. Would recommend McCambridge Duffy
