Can I get a mortgage when in an IVA?

There are no technical reasons that stop someone with an IVA being allowed a mortgage, but there are plenty of practical issues that would need to be overcome first.

Practical Problems To Overcome

The IVA itself will create issues for you when trying to obtain a mortgage.

Problems related to creditworthiness, interest rates and the size of the required deposit will all need to be addressed if a mortgage application is to be successful.


All mortgage lenders will undertake a credit check on any mortgage applicant, as standard practice. This means that they'll be able to see from your credit file that you're in an active IVA.

At this point many mortgage lenders will reject the application, but there are some specialist mortgage lenders who will be prepared to offer a mortgage to someone within an IVA.

However, by the nature of the perceived credit risk they'll taking, they'll seek extra security and larger profits from the mortgages on offer.

The deposit

The extra security they seek will come in the form of a larger than normal deposit.

Currently, mortgage lenders offering mortgages to people in an IVA demand a deposit of 50%. This means that they'll only be willing to lend half of the value of the property being bought. They'll expect the remaining half to be put down in cash by the buyer.

For most people in an IVA this demand by itself will render the mortgage unachievable.

The interest rate

The larger profit element of the mortgage is generated by the higher interest payment that someone in an IVA would be expected to pay.

Interest rates for IVA mortgages will be significantly higher than those for people with a health credit score.

The extra cost of borrowing ensures the mortgage company are rewarding themselves for having taken on the extra risk associated with lending money to someone with a bad credit rating.

Even though they'll have protected themselves with the larger than normal deposit, they'll still seek to inflate their margins.

Your IVA obligations

As if the points above weren't enough by themselves, there are also other issues, relating specifically to the IVA, which need to be considered and addressed.

For instance, if you're in an IVA and you acquire an asset, such as a property which holds 50% equity, you're Insolvency Practitioner (IP) will need to be informed.

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