A Mortgage in an IVA, Question by Question
Why it is so hard during, and when it becomes realistic.
Can I get a mortgage while in an IVA?
Realistically, no. A mortgage is a large new borrowing, and while your IVA is active your credit is impaired and new credit is restricted. Mainstream lenders will not offer a mortgage to someone in a live IVA, and you would in any case need your supervisor's permission to take on borrowing. So although it is not formally banned, in practice it is almost never possible during the arrangement.
Why is it so difficult?
Because of how an IVA affects lending. Being in an IVA, with the defaults that usually accompany it, makes you a high-risk applicant, and a mortgage is one of the largest commitments a lender can offer. Mortgage lenders also check the Individual Insolvency Register and your credit file. With an active IVA showing, applications are turned down almost as a matter of course.
Do I need my supervisor's permission?
Yes, for any significant new borrowing. You cannot take on credit over £500 without your supervisor's written agreement, and a mortgage is far beyond that. They would need to be satisfied it is appropriate and affordable, which is rarely the case mid-IVA. Taking on a mortgage without consent would breach your arrangement, so the conversation has to happen first, if you could find a lender at all.
Are there any specialist lenders?
Very few, and on tough terms. A small number of specialist lenders consider applicants with an IVA, but typically only with a large deposit and at high interest, and many will still decline an active IVA outright. For the great majority of people, a mortgage during the IVA is not a realistic prospect, and chasing one can mean wasted applications that further dent your credit.
When does it become realistic?
After the IVA, as your credit recovers. Once your IVA is completed and the marker drops off your file, six years from the start, mortgages become genuinely achievable again. Specialist lenders may consider you a year or two after completion with a larger deposit, and mainstream options open up further as your record rebuilds. Our guide on buying a house after an IVA covers this in detail.
What if I'm partway through and want to buy?
Usually it is worth waiting. If you are some way into your IVA and hoping to buy, the realistic plan is generally to complete the arrangement first, then rebuild and apply. Trying to buy mid-IVA tends to mean rejection or very expensive borrowing. Focusing on finishing the IVA well, and saving a deposit where you can, puts you in a far stronger position afterwards.
Does this affect remortgaging too?
Remortgaging is similarly hard during an IVA. The same impaired credit and restrictions apply, so remortgaging to a new lender is rarely possible while the arrangement is live, though a product switch with your existing lender is sometimes an option. Under the current rules you are not required to remortgage anyway. Our remortgaging guide explains the detail for homeowners.
Should I get advice?
Yes, both now and nearer the time. A free, impartial adviser can help you finish your IVA strongly, and when you are ready to buy, a specialist mortgage broker can map out a realistic route. Knowing that home ownership is achievable after the IVA, with the right timing and deposit, lets you plan ahead rather than pin hopes on an unlikely mid-IVA mortgage.
