Mortage with DMP / IVA about to start

Jam_Banjo

Hi there -

We are going to arrange to speak to mortgage advisor and I will be contacting my Debt management company about this all soon but wondered if anyone could offer advice.

We are married with a young son. My mother-in-law is looking to move after selling her house (on the market atm). She has paid off her mortgage so will have a sizeable amount and was looking to potentially downsize. She has floated the idea of getting a house together to get us on the property ladder and give us help with looking after her grandson!

However I have large debts that will require either a DMP or IVA to sort out. My wife is named on one of the debts but hoping to get her removed from that debt.

I have a decent income to pay a reasonable amount per month but nowhere near what the multiple debts had grown into.

I run a limited company with my wife (both company directors) we receive a small salary and dividends.

So - is there a way we could get a mortgage with her mum? Or will the impending DMP / IVA mean it is impossible? We can afford mortgage repayments as our rent at the moment is £1300 (living in the South-East).

And moreover will the mortgage be safe for my mother-in-law? The main thing we want to ensure is that she is protected and even if we did get one, that halfway through the DMP / IVA we won't have a creditor try to take the house or something.

Thanks so much, we are seeking professional advice to plan for the future but appreciate anything you can let us know.

foxy-stoat

If your thinking DMP or IVA then you should not be thinking about a mortgage.

If you already had a mortgage with equity then you need to think a lot harder about an IVA.

Have you done the PPI reclaim thing, and tried to sell stuff, down value cars to pay down your highest interest debt first and transferring onto low interest loans/credit cards?

ACG

I echo foxy-stoat.
Chances are with the amount of debt you have compared to income, you are going to have a negative effect both on lending amount and potentially on likeliness of acceptance.

If you enter a DMP/IVA and have an asset with a lot of equity, your MILs portion could be protected but it means a headache for everyone involved.

If you go down the IVA route, it will be around 3 years before you can get a Mortgage, a DMP will likely be 2 years.