Hi Fiferover

Why 8% per annum? This is the rate of interest charged to DEBTS on the basis that there is sufficient funds to repay all debts in full. It has no revelence to the equity position.

Mark

It states 8% in my trust deed. quote " There is currently ?ú3950 equity in the property. The trustee intends to allow the debtor to continue to occupy the property on the basis that the above detailed sum plus 8% statutory interest per annum is ingathered for the benefit of the creditors at the conclusion of the trust deed period"

Hi Fiferover

Some of the stuff on this site never ceases to amaze me. For this TD to be accurate, the IP would have required to have the valuation of the property and redemption figure for the mortgage before the TD was signed to allow him to 'insert' this into the TD. Is this the case?

Was this discussed before signing and who is the Trustee?

Mark

I was asked at the outset to get a valuation for the property so I did this and was asked the outstanding balance on my mortgage. The diffence between the two was ?ú3950. I was asked if I was able to pay that at the commencement of the trust deed, of course at that time it was impossible. I was told that I could defer payment of this till the end of my TD, where it would be easy to remortgage. I wasn't advised of the 8% per annum interest and was a bit surprised when this appeared but was advised that this was standard.
I have since found that this would be very difficult to get someone who would provide a remortgage.
The trustee is Invocas.
I have contacted them on advice on how to get this money, they have now got an up to date redemption statement and are going to get my house revalued. After these are done, I will discuss options open to me. They have mentioned that they are someway connected to a company called Clear Finance.

sorry the finance company is Allclear Finance

Hi Fiferover

Ah! Invocas/New Tomorrow.

The 8% has been added for no valid reason. As detailed earlier, this is the % interest charged on debts if you come into money sufficient to clear all your debts and costs and end the Trust Deed earlier. Not a figure that you 'guess' will be the rise in value of your home will be!

I fail to see how they can ask for a valuation, ask for the setttlement figure all from you, agree an equity balance and add 8%. Then tell you 3 years down the line that they will get a new valuation and new redemption figure.

The normal way to deal with equity is to make additional paymehts and extend the TD.

Could you keep me posted when the valuation etc comes back.

Mark

will do thanks

With regards to the 8% per annum, due to the fact that I have agreed to the trust deed is payment of this avoidable?

Hi Fife

Sorry for the delay. The answer is probably yes. However I would certainly question the logic and the request for the additional valuation and ask where the 8% came from.

Mark

Have had the house valued but don't know what the amount was. Asked about the 8% , person dealing with trust deed can't really understand why it was put into the trust deed but said because it was there it was legally binding. She did say that usually that would usaully get a redemtion figure at end of trust deed and that would be final but my trust deed has been done differently. Asked what options were open to me regards paying this options were getting the money from a third party, something where the scottish government buys your house or selling the house.
Any advice on this would be welcome.
Also is there any guidelines on what level should be paid to creditors? Mine are being paid 5p in the pound so I take it from a debt of ?ú24000 roughly ?ú1200 will go tO creditors and the remaining ?ú10,800 being paid will go to Invocas

Hi Fife

Invocas (or New Tomorrow) seem to be all over the place with this. It appears to be a mixture of several ideas thrown together.

I'm not sure why they build in an 8% figure then had a valuation carried out. Also creditors look for a minimum 10p in the ?ú. This may have been different when you signed, but how they can justify fees of ?ú10,800 is beyond me.

As for moving forward, I think the you need to have a final equity figure and then I would look at making additional payments beyond the 3 years in reduction of the equity.

Hope this helps (a bit)

Mark

HI just to let you know the amount to be found is ?ú4898. ?ú3950 plus the interest. I have been told that I have to advise them how I am going to pay this. They say that the trust deed can only be increased for a year.
Don,t know what to do now.

Hi FIFEROVER,

How much do you pay into your Trust Deed each month currently?

?ú200