What’s the chances ?

Christologymum_2

Myself and my now ex took out an IVA in March 2018 so settled early next year. All defaults now dropping off, bar couple of late payments to Vodafone in 2021 my credit file is looking pretty good.

when we separated we agreed I would stay in the family home until the IVA was settled and the fixed rate ended which it does in Aug next year. I’m looking for advice of if I will be able to move/buy him out next year. 

Current property value £280k ish, still owe £145k. 

So if I was to buy him out I’d need to raise £60kish, might get him down to £50k. 

Alternatively I could sell and buy my own property, I’m really stressing about if I’ll be able to do either. I have heard people saying I’ll need min 30% deposit for a newly settled IVA so could look to borrow £130 ish with £60k deposit would give me £190k to buy something, I’ve got 3 kids and won’t get a 4 bed round here so would have to be a 3 bed.  I would owe less than I do now and affordability would be fine.

Income wise, I’m on about £45k plus approx another £15k a year in maintence/DLA. 

Spoke to a broker and he thought buying out and moving would be an option but I can’t stop stressing about it and worrying we’ll end up homeless. Everything I’ve read about mortgages with newly settled IVA’s say slim pickings. Currently with Aldermore and never missed a payment in 14 years but spoke to them and they don’t lend until 3 years from discharge. 

any advice would be appreciated to put my mind at rest. 

I could always rent I guess but would rather than as expensive and also I’d lose some of my benefits with having all the equity once over 6 months, so would be down money plus paying more rent also. 

ACG

You should be fine. You have a reasonable deposit. 

I did a case last year where the IVA was paid off at the same time as the mortgage completing. I think the lady needed a 40% deposit but she had a choice of a smaller deposit but a higher rate... she opted for the larger deposit as she had received an inheritance payout. 

But you should trust the broker, assuming they only get paid if you get your mortgage they must only be taking it on if they have some confidence. 

fatbelly

Insolvency Practitioners can be slow to issue a completion certificate, and the IVA stays on your credit file beyond 6 years till they do.

So you may have to nag

kingstreet

There are high street lenders who work on six years from registration rather than from date of discharge; so you may have better options come March next year.

Christologymum_2

Thanks all. 

IVA ends March 2024 and fixed rate Oct 2024 so was thinking of starting to do something Aug time next year, hopefully it will have gone from credit file then.

I was under the impression that it would be removed at the 6 year anniversary not when the discharge letter comes? Can anyone confirm that’s the case. It’s stepchange if that’s any help, not sure how quick they are. I guess if I have to wait longer ex will just have to wait, I’d just have to go onto variable rate once fixed rate ends, which would be a killer but would manage. 

Hopefully 6 months will be enough time for them to have sent it anyhow and it to have gone. 

So there should be options once it’s discharged, maybe even high street?

I do trust the broker but I only spoke to him briefly so just have that nagging doubt I guess. 

Thanks everyone 

fatbelly

Bankruptcies and IVAs disappear from credit files on the 6th anniversary except in the rare cases where they are still current beyond that date.

Some cras are very vague on this and I've only recently discovered it myself.

FWIW stepchange are amongst the least bad of the Insolvency Practitioners

ACG

You wouldnt believe the amount of people we have spoken to over the years (this will probably be the same for most brokers) where they start with "I know you probably wont be able to help but....".

They end up with a mortgage at the end of it most times - the exceptions are where the adverse is very recent and they have a 5% deposit (if that!). Yours is not the best I have seen, but certainly not the worst and you have a lot of equity. The broker you to spoke to seems confident, I think you will be fine (I have been a broker for 12 years) and Kingstreet thinks you will be fine and he has been a broker since before I could walk I think.

I know there is nothing I can say that will stop you worrying completely but 3 brokers with at least 2 of us are pretty experienced thinking you will be fine... 

Christologymum_2

Thanks so much