NRAM Considering IVA for unsecured element

[Debt Camel]

Re: NRAM Considering IVA for unsecured element

Morning all, just wondering if anyone has any thoughts regarding the IVA question - whether to go for an IVA OR pursue some other avenue. I really am not sure about this.

It used be very common for NRAM to insist on a 6 year IVA term rather then the usual 5. Has the IVA firm you have been speaking to mentioned this? Which IVA firm are you talking to?

As you are renting you should seriously consider bankruptcy as an alternative to an IVA. This is not worse for your credit record and generally makes little difference to your chance of obtaining a mortgage afterwards - not least because your bankruptcy payments end after 3 years whereas the IVA goes on for 5 or 6, that is 2 or 3 extra years in which you save up a deposit.

See http://debtcamel.co.uk/bankruptcy-iv...credit-rating/ for the credit rating issue and http://debtcamel.co.uk/hard-choices/iva-vs-bankrutcy/ for a general comparison of an IVA and bankruptcy.

[davyatsea]

Re: NRAM Considering IVA for unsecured element

Hi Di. The initial interest rate was 5.99% on an initial fix. This reduced to 4.79% while I owned the property. When I sold in 2014, the interest rate increased to 12.79% and has remained at this rate ever since. The rate only recently dropped to 12.54% following a reduction in the Bank of England base rate. The current arrears stand at £950.88, which works out at just over three months, but I have not been threatened with any legal action.

[Diana M]

Re: NRAM Considering IVA for unsecured element

Hi Di. The initial interest rate was 5.99% on an initial fix. This reduced to 4.79% while I owned the property. When I sold in 2014, the interest rate increased to 12.79% and has remained at this rate ever since.

So the interest rate almost trebled on the unsecured loan when the secured loan was paid off

Di

[davyatsea]

Re: NRAM Considering IVA for unsecured element

I sold the property due to a job offer in the West Midlands (property was in Portsmouth). There was no way I could move the mortgage to a new property and the rental income would not have been enough to cover the mortgage (even if NRAM would let me do this. I did not have enough equity to repay any of the unsecured element, and indeed any surplus from the sale of the property was used in relocation expenses. The actual amount owed to NRAM stands at £28208.42. Yes, the interest rate trebled when the secured loan was paid off (svr plus 8% penalty interest)
As for the IVA, my wife spoke to an IVA consultant yesterday and he seemed certain that NRAM would agree to a five year IVA. I was concerned that he seemed very pushy and wanted us to sign up right away without further thought.

[Diana M]

Re: NRAM Considering IVA for unsecured element

The actual amount owed to NRAM stands at £28208.42. Yes, the interest rate trebled when the secured loan was paid off (svr plus 8% penalty interest)

As for the IVA, my wife spoke to an IVA consultant yesterday and he seemed certain that NRAM would agree to a five year IVA. I was concerned that he seemed very pushy and wanted us to sign up right away without further thought.

So the 8% "penalty" interest on the unsecured loan was charged because you paid off the secured loan.

Maybe the IVA consultant was on commission?

Di

[Diana M]

Re: NRAM Considering IVA for unsecured element

I sold the property due to a job offer in the West Midlands (property was in Portsmouth). There was no way I could move the mortgage to a new property

Was there an option to 'port' the mortgage in the original Ts & Cs or do you mean you didn't want to move it to a new property anyway?

Di

[davyatsea]

Re: NRAM Considering IVA for unsecured element

Yes the 8% penalty interest was added when I sold the property. Before this, I was paying £165 towards the unsecured element. With the penalty interest, I am now paying £316 (without taking into account any arrears). If the interest rate had remained without the penalty, I could effectively pay £316 and be overpaying. Because of the penalty, there is no scope. I paid £416 this month to try and reduce the arrears, but this is unsustainable.
As for the IVA consultant, I do have my suspicions.

[Diana M]

Re: NRAM Considering IVA for unsecured element

Yes the 8% penalty interest was added when I sold the property. Before this, I was paying £165 towards the unsecured element. With the penalty interest, I am now paying £316 (without taking into account any arrears). If the interest rate had remained without the penalty, I could effectively pay £316 and be overpaying. Because of the penalty, there is no scope. I paid £416 this month to try and reduce the arrears, but this is unsustainable

That doesn't seem very fair since you had no option but to sell up and move for job reasons.

From what you say you're only in arrears as a result of the trebled interest payments.

Di

[davyatsea]

Re: NRAM Considering IVA for unsecured element

In a nutshell, yes.

[Debt Camel]

Re: NRAM Considering IVA for unsecured element

my wife spoke to an IVA consultant yesterday

"IVA consultant" - do you mean someone at firm that is just passing you on to an IVA firm? If so, they may have little knowledge of this sort of detail.

Which firm does the IVA consultant work for? And which IVA firm will you be passed on to?

[davyatsea]

Re: NRAM Considering IVA for unsecured element

This is the link that my wife saved http://advice-debts.com/ppc/ but when I spoke to them afterwards, I was told that the iva company used is Johnson geddes

[Amethyst]

Re: NRAM Considering IVA for unsecured element

Not much info on that site - sure that's a breach of something [MENTION=48934]Debt Camel[/MENTION]; for lead gen / iva introducers ?

www.advice-debts.com is not affiliated to any charities such as Step Change, The Citizens Advice Bureau and National Debtline.

www.advice-debts.com do not provide debt advice or debt solutions, they simply introduce people struggling with debt to a carefully selected debt management organisation.

www.advice-debts.com is provided by Ultima Lead Generation Limited (Company Number 08296351)

Our mission is to provide an ethical and transparant introducing process. If you have any issues or concerns with this website please feel free to get in touch via this address Ultima Lead Generation Limited 43 High St, Oldham, Uppermill OL3 6HS or email info@ultimaleads.co.uk.

[davyatsea]

Re: NRAM Considering IVA for unsecured element

I think there was an option when they were still northern rock, but once they became nram, that option was lost. From what I can gather, they just want rid of all debts attached to them.

[Diana M]

Re: NRAM Considering IVA for unsecured element

I think there was an option when they were still northern rock, but once they became nram, that option was lost.

That's what I was trying to establish.

When you took out the mortgage with Northern Rock the option to port it was there (in the Ts & Cs) but later on when you might need to do that NRAM removed that option despite it being in the Ts & Cs.

Di

[davyatsea]

Re: NRAM Considering IVA for unsecured element

They did seem to have a few companies that they 'introduced' to, which has raised my suspicions.