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Posted: Thu Mar 05, 2015 10:10 am
by vlc1507
Hi all,
I hope someone may be able to help. Paperwork sent last Oct received letter Feb 15 saying £29,940.07 equity, questioned this as my calculation said no equity, Value £225,000, Mortgage Redemp £181,901.39 Equity £9348.61 joint IVA so below £5000 de minimis each.
Today got email with the following calculations
Value £225,000
Mortgage Redemp £181,901.39
3.5% selling fee £7875.00
Equity £35,223.61
50% each £17611.81
85% available equity £14,970.03.
Please can someone suggest what we can say to Gt, seems to me they are trying to get extra money which isnt there.
Any help greatly received.
Posted: Thu Mar 05, 2015 10:21 am
by Foggy
Some IP's do seem to try to work out equity this way, which, in my opinion, is wrong, but will depend upon the exact wording in your proposal ( even a comma, or lack thereof, can make a difference --- which is why most legal documents lack punctuation )
We have had instances where the method GT are using has been questioned and the firm has backed down -- this is often due to an inexperienced member of staff using the wrong method.
Posted: Thu Mar 05, 2015 10:28 am
by vlc1507
Thanks Foggy,
What is the best way of tackling Gt. Just dont know best way forward, seems so unfair when we are so close to the end.
Posted: Thu Mar 05, 2015 11:38 am
by Foggy
If you are sure, according to the wording in your proposal, that your method ( which is what I would use) is correct then write to GT telling them so and giving your calculations. If they refuse to budge you can make a formal complaint and / or take this up with their regulatory body.
Posted: Thu Mar 05, 2015 11:39 am
by Foggy
Are there any other GT clients who have undergone equity release reading in ?
If so, what method did they use ?
Posted: Thu Mar 05, 2015 11:42 am
by Adam Davies
Hi
This seems wrong to me so do challenge it, I think it should relate to 85% loan to value and not 85% of any equity so do check the exact wording on your chairmans report following your initial creditors meeting
Regards
Posted: Thu Mar 05, 2015 2:37 pm
by vlc1507
Hi Andy and Foggy,
Thanks for your replies wording says
"Re mortgage at a maximum of 85% loan to value of the property less the existing secured borrowings(LTV less secured sums)but subject to affordability criteria.
In my outcome statement I have shown estimated which I consider will be paid into th IVA after month 54.
If no amount is shown (there is no amount shown) either 85% of the current value of the house is less than the current outstanding mortgage or my share of equity in the house is less than £5,000 (gross).
In the event that the valuation after month 54 demostrates that my share of equity is less than £5,000 (gross), the property is excluded from the arrangement. This does not affect any other terms of the arrangement and the arrangement will continue to 60 months with contributions being paid as described.
Sorry for the rather long post but wanted you to see all info so you can advice what is best to do based on this.
Thanks in advance
Posted: Thu Mar 05, 2015 5:54 pm
by Foggy
They are limiting the remortgage ceiling to 85% LTV. So £225k market value gives an 85% LTV of £191,250 ... £9349 equity, of which your share is half ... less than de minimis. No extension.
Posted: Thu Mar 05, 2015 7:27 pm
by Adam Davies
Hi
Seems very clear that no equity release or extension is due
Go back and challenge GT, they have made a big mistake
Regards
Posted: Thu Mar 05, 2015 7:33 pm
by vlc1507
Thanks Foggy,
That is how I thought it read, just wanted someone to confirm it for me.
I will email them and see what happens.
Posted: Thu Mar 05, 2015 7:47 pm
by vlc1507
Thanks Andy and Foggy,
I will email them tonight.
Am I ok saying I feel they have made an error and give them the calculations I believe it should be.
Just worried it may go against us but then again why should we suffer for their poor calculations.
Posted: Thu Mar 05, 2015 8:45 pm
by Foggy
As long as you are polite they can hold nothing against you -- you are an adult and are merely pointing out that you do not agree with the way they have interpreted the equity release provisions.
Posted: Thu Mar 05, 2015 9:02 pm
by Adam Davies
Hi
Mistakes are made, we have seen it on the forum many times. A member of staff for GT has not understood the exact terms of your IVA
Regards
Posted: Thu Mar 05, 2015 9:03 pm
by vlc1507
Great Foggy, Thanks
have drafted a very polite email saying we feel their calculations are incorrect based on our agreement and could they please review based on this.
Will keep our fingers crossed.
Posted: Thu Mar 05, 2015 9:07 pm
by vlc1507
Thanks Andy.
That is what we are hoping.
Will let everyone know how we get on