www.iva.co.uk

My husband and I entered an IVA in January 2014, this was extended for one year as we couldn’t (and didn’t want to) remortgage. Our final payment was paid on 2nd Jan 2020, we’ve received a letter confirming that a final review has been completed and no further money is due. I’ve spoken to them and they’ve confirmed that they’re in the process of preparing their final report and all remaining money is being distributed. They estimate to have our completion certificate with us in the next 2 months.

Our plan was to wait until we had the completion certificate and have been removed from the register then attempt to remortgage in order to secure a better deal and take additional lending to replace our 2 cars (had for 10 years, in desperate need of replacing). However, an opportunity has arisen and we really don’t want to pass it up.

There’s a plot of land next to our house that we’d love to own, and have been of that opinion for ten plus years. It’s now on the market for £15-20,000. If we wait until all of the above has happened then it’s potentially going to be May/June before we can think about remortgaging to finance this (if it’s even an option then), by which point I think it’ll be too late. A possible option would be to take a secure loan now in order to fund the purchase of the land and the 2 new cars.

Looking at my credit file it seems I could potentially get a secure loan of 40k with a term to match our remaining mortgage, with repayments of less than half of what we paid in to the IVA each month.

My questions are.....

1. Would we be ‘allowed’ to do this right now? I know you can’t take additional borrowing of over £500 whilst in an IVA, are we still classed as ‘in’ it now?
2. Is it possible to get a secure loan whilst there’s still the IVA related restriction on the property?

Apologies for the massive amount of text, I thought a little background may be useful.

Any advice would be appreciated!

Your credit record will be shot for six years from the start and/or until you get your completion letter. You could look at a secured loan but I would suggest speaking to either Ryan or Shaun who are our mortgage experts to see if they can help you.

Look at this from the creditors point of view ----- you were unable to remortgage and so had to extend, but now, still technically in the IVA, you can remortgage. If this did happen the IVA could call on the released funds, so not a safe option until such time as you get the completion certificate and the IP has removed the restriction on the title.
Is there anyone who could fund the purchase for you, until you can safely remortgage ? Technically, you can't 'borrow' from them, but if you decided to 'repay' them after the IVA is closed that would be your business.

Sat Jan 18, 2020 4:24 pmFoggy wrote:

Look at this from the creditors point of view ----- you were unable to remortgage and so had to extend, but now, still technically in the IVA, you can remortgage. If this did happen the IVA could call on the released funds, so not a safe option until such time as you get the completion certificate and the IP has removed the restriction on the title.
Is there anyone who could fund the purchase for you, until you can safely remortgage ? Technically, you can't 'borrow' from them, but if you decided to 'repay' them after the IVA is closed that would be your business.

Thank you for taking the time to answer. Is a secure loan classed as a remortgage? The company I’ve been looking at for the loan is a different company to the one my mortgage is with and I’m not looking to do anything with the mortgage funds until a later date.

Sadly there’s no one who can help us, we’ve only told one person about the IVA and to have to explain it to anyone else at such a late stage wouldn’t be good. The 2 people who could potentially help wouldn’t if they knew the circumstances, and wouldn’t help without knowing the full reason we needed to ask them, so it’s a bit of a catch 22.

Sat Jan 18, 2020 4:16 pmkallis3 wrote:

Your credit record will be shot for six years from the start and/or until you get your completion letter. You could look at a secured loan but I would suggest speaking to either Ryan or Shaun who are our mortgage experts to see if they can help you.

Thank you for replying

A secured loan and a remortgage are two different animals, but the end result is the same, i.e. release of equity.

If you are considering a secured loan. Please use your mortgage company to borrow. I had a secured loan before I started my iva and due to circumstances lost my home which I had been buying for 15 years, my mortgage was always up to date. Please think twice before getting any more debt. Only plus side was that the secured debt became unsecured and became part of my iva.. I am now debt free and my credit rating has improved loads. I would love to but another property.. Not trying to put you off. But just be careful with secured loans.. I do wish you luck in buying the land, and congratulations on completing your iva. x