www.iva.co.uk

Annie I am so sorry to hear your news just when you think it is all over. I am surprised they are not just adding on another year hopefully on of the experts will see this post and help you with advice. Good luck

franky ive found out why we have to take the loan,,,our mortgage company ,,,bank of ireland wont let us remortgage cause we are on the iva,,,even though we have been with then for 10 years and never missed a payment ,,,the only other mortgage companys that will accept us now is the ones with really high interest rates which will bump up our payments sky high..looks like its the only thing we can do,:(..never mind only 5 years to go ,,,ill hang in there if i can xx

hi km,,,thanks for the post,,hubby just explained that we have equity in the house so they want there money,,,we havnt a credit record now so we have to take there option;(

Annie -- what exactly does it say regarding equity in your proposal ? The usual procedure these days is to extend the IVA by 12 months instead of equity release, if unable to remortgage.

What are DFD proposing ?

I find it very hard to believe that this has come as a complete suprise, when the equity release provisions are very well known and IPs must explain these fully to their clients prior to the IVA proposals being finalised. Surely this cannot be the first you have heard about this - you must have signed the proposals at the end of the day?

I suggest that you discuss this with your IP and perhaps take legal advice to ensure that what you are being advised you have to do is properly in accordance with the agreement you signed up to. If all you were required to do was to explore a re-mortgage, then being advised to take out a secured loan is not the same thing. The answer lies within the proposal documents, so it would be well worth digging them out ahd having a further read through, perhaps taking further advice if this still seems unclear.

hi foggy,,,dfd are proposing that we take out a loan because we have equity in the house ,x

Hi Annie, hope you can get this sorted. We have a poster from DFD whose details will be in the experts section. Declan has helped a lot of posters in the past and could perhaps help you get the answers you need.

x

Just as it is impossible st the moment to re-mortgage (which is secured and a better bet for lenders) I would imagine it would be even harder getting a loan -- and the interest rate will be astronomical!

Annie I think you may be slightly on the back foot here, after all as you have an equity clause in your IVA proposal it seems strange that you have managed to complete the 5 years without "attempting" to obtain a mortgage, which "normally" would be done in the final year. Obviously it does not stack up or help that DfD didn't remind you of this prior to reaching the final payment.

That said could it not be the case that DfD are throwing you a get out clause in that they will accept the "expected" equity release funds via another means, in this case a loan?

Notwithstanding the aforementioned it does not seem quite right that DfD are steering you in the direction of what could quite possibly be construed as an "attached" loan company, after all you sought their guidance in eliminating your debt.....not to take on more via a loan....as others say it makes a mockery of the IVA system.

In any event as you have an "equity release" clause and need to find the money somehow, I would seek the assistance of an Independant Financial Advisor to see if they can work out your best options...be that by remortgage, loan etc.

GL

It is more normal to explore equity release these days in the final year of the IVA.

Annie - we could all give you our thoughts and suggestions, but in actual fact your IP at DFD is the person you need to discuss this with.
Declan from DFD will be more than willing to help you if you use the email address in his contact details under the expert page or members a-z list.
I will give Declan a heads up to look out for an email from you and I am sure it will be resolved.

I was with DFD and the proposal docs clearly explained what the requirements were, but they were also very quick to say if money cannot be raised then a likely 12month extension will be imposed - like others I am shocked to hear a loan for 5 years has been suggested.

Contact Declan off forum and see how you get on.

Thanks Melanie......duly corrected.

Hi Annie
I too would be very interested top look into this to understand exactly what your proposal states and what is exactly required. If you would drop me a line, I will look into this asap. My contact details can be found in my profile.

Thanks

The equity release is explained to all clients and until recently many clients did remortgage. It has only been as a result of the credit crunch that funding has ceased which has lead to most mortgage products being removed. The twelve month extension is a concession in cases where equity cannot be released and is not a choice that clients have.

The poster says that she will have to repay the loan for between 5 and 15 years depending on how quickly she wants to repay the debt. If there were mortgage products available she would be switching her entire mortgage balance to sub prime rates and would probably have to extend the term to the maximum. This loan she has been offered is clearly a better alternative and if she takes it over 15 years at a relatively low payment she can remortgage in a couple of years at high street rates and pay it off.

Personally I do not think it is unreasonable and perhaps those currently in IVAs are under the false illusion that their IVAs will be for 6 years and their properties automatically excluded. If the mortgage market changes and you can obtain finance you will have to do so in month 54 as stipulated in the protocol IVAs. A secured loan is a way of raising equity and seems to me a fair way of dealing with this issue.

Why should the poster pay an extra year when she is in a position to raise at least some of the equity she agreed to when the IVA commenced?

I think this all boils down to the fact that a lot of people just do not understand their proposals fully because they are under so much stress at the time. It's so easy to just sign something out of desperation. I read mine through many times before signing but I still have to refer back to it now and then to make sure that I understand everything in it. Some firms are much better than others at explaining things too!!