Remortgaging in an IVA, Question by Question
How the rules changed in 2025, and what it means for your home.
Will I have to remortgage during an IVA?
For a new IVA, no. The rules changed in 2025, and remortgaging to release equity is no longer part of a standard IVA. Instead, your equity is looked at once when the IVA is set up, and if you have a meaningful amount, your IVA is made a little longer rather than you having to refinance your home. It is a simpler, less stressful approach than the old system.
How is the equity decided now?
It is assessed at the start, using a set formula. Your equity is worked out as 85% of your home's value, less your mortgage and any other secured borrowing, and counting only your share if you own jointly. This figure decides how your IVA is structured, but it does not mean you hand over equity or take out new borrowing. It simply sets the length of your IVA.
What if I have £10,000 or more of equity?
Then your IVA usually runs for six years instead of five. Under the 2025 rules, if your share of the equity is £10,000 or more, an extra twelve months of payments is added, and that stands in place of releasing any equity. Crucially, your property is excluded from the arrangement, so even if its value rises during the IVA, you will not be asked for more.
What if my equity is under £10,000?
Then your IVA runs the standard five years. If your share of the equity is below £10,000, it is effectively ignored, your home is excluded, and there is no extension and no remortgage. This is also the case if you are in negative equity or have only a small share. You simply make your agreed payments for the normal term.
So I never have to refinance my home?
Not under the new rules. The whole point of the 2025 change was to protect homeowners from the cost, stress and uncertainty of trying to remortgage, often on poor terms, while in an IVA. For new arrangements, the equity question is settled up front and dealt with through the length of the IVA, not through new borrowing against your home.
What about older IVAs?
They may work differently. If your IVA was approved before July 2025, it may still contain the older equity clause, which asks you to try to remortgage in the final year to release equity. If you cannot get a suitable remortgage, your IVA is instead extended by twelve months. If you are on an older IVA, check your own paperwork or ask your supervisor which rules apply to you.
Could I still be asked to take a secured loan?
Under the new rules, no, and even under the old ones you could push back. A standard 2025 IVA does not require remortgaging or secured loans at all. On older IVAs, some firms suggested high-interest secured loans where a remortgage was not possible, but these could be challenged, and the twelve-month extension was usually far cheaper. If anyone pressures you toward an expensive secured loan, get independent advice.
Will any of this put my home at risk?
No, that is the point. Neither the new rules nor the old ones force you to sell your home, an IVA cannot do that. The equity is dealt with either by a slightly longer IVA or, on older arrangements, by an attempted remortgage with a twelve-month extension as the fallback. As long as you keep paying your mortgage and your IVA, your home stays yours.
Should I get advice?
Yes, especially as a homeowner. The equity side of an IVA is where homeowners most need clear, current advice, and the rules have recently changed. A free, impartial adviser can explain exactly how your equity would be treated and whether an IVA is the right route for you. It costs nothing, and for homeowners it is well worth getting before you decide.
