www.iva.co.uk

Hi all,

we have just received a letter from our mortgage provider Northern Rock, stating that our interest only period will expire next month, and we will revert to a repayment method. Now this will impact greatly on our ability to make payments into our IVA.

I have spoken with NR, and they tell me they do not usually extend interest only periods for greater than 12 months, and that we will have to reapply and the decision will lie with the underwriters.

Does anyone know if a 12 month maximum period is correct?

I have emailed our IP [Melanie], but would welcome the forums views.
Many thanks.

Hello. Not sure on the answer. However, it was Northern Rock who forced me into interest only when our IVA was approved & then charged me £75 for the privelidge. So I suppose they are expecting me to stay interest only for the 72 month duration.

why did they force you into interest only Mark-we are on repayment with them and have the 72 month iva and they were our main creditor-seems very unfair to me.
Wouldnt have even considered an iva if this had been requested.
They are getting their extra year out of you then penalising you further-ridiculous.
No wonder they went under.
Sinking fast-speak to them about extending the interest only period-if they are a creditor it wouldnt be in their interest for your iva to fail.
Good luck.

Thanks Guys.

I have spoken with them and they are sending me another application for to extend. They did add that the underwriters will have the final say.NR are one of our creditors, so as you state it would not be in their interest to drive us into BR, and get the best part of nothing.

Think it was due to the fact our dividends would have been very low.

Sinking Fast I changed to an IO mortgage with NR when I took out my IVA and they extended it for a second year in Oct/Nov last year.

Not sure whether or not it will be extended for consecutive years, which obviously could impact on my IVA payments at sometime but just taking things day to day and will cross that bridge when I get to it.

Good Luck

Thanks Pennyless.

Im hoping Melanie can shed her experience when she comes online.

Im hoping they extend, otherwise its curtains for our IVA.

Sinking Fast I dread the thought of getting 3/4 years into my IVA and NR turning round and refusing to extend my IO mortgage but what can we do....after all had I not taken IO then I would not of got my IVA agreed.

Have discussed it with my IP but unfortunately theres no one solution fits all and so it may fail or may not. This is one of the things that everyone should be clear about when going IO for an IVA but unfortunatly many of us are guilty of grasping at any straw when faced with the alternatives.

Yes I think your correct. I would rather it fail now, than be told by NR that I must go back to repayment in 3/4 years, then having to go BR.
All that money wasted.

Anyway I shall await Melanie s views, and then fill out the form once I receive it from NR next week.

Hi sinking Fast - Mel is a bit of a night owl so might not be around for a while. If you don't hear tonight, I'm sure there'll be something for you in the morning.

I would be surprised if they forced you into a repayment mortgage, particularly if you have an unsecured element in your IVA.

Hi Broke.

Yes our mortgage is with NR, and we have an unsecured loan with NR - NOT a together mortgage.

I have everything crossed that common sense will prevail for you x

In my experience they have historically extended for a year at a time with little bother, but I am not aware if there has been a change in policy recently.

Best to fill the forms in and then see what happens. If they refuse, we will put up a case to them for an ongoing extension.

Thanks Melanie for your reply. I will keep you informed of the outcome.

Well we have been informed by Northern Rock that by the time we complete and return the IO mortgage application [still waiting], our payment due on the 1st April will have been debited.

This means an extra £240, which represents the repayment mortgage amount being taken from our account.

My question is this; we will be unable to afford our IVA this month, and if this is the case does the missed payment get added on?. I have emailed our IP and am awaiting a reply.

We are also awaiting a variation meeting, as due to losing my job last year, and securing another position, my salary as reduced - hence a request to lower payments to reflect this issue.

It seems that there are so many variables when it comes to an IVA, and the success or failure balances literally on a knifes edge!!