Anyone know about IVAs? Question

papermoney

A friend of my partner is in a IVA, he is close to defaulting (i'm not sure if he has actually defaulted or not yet). He has a plan to sell his house pay off the IVA and mortgage and live in a caravan for a 2 years. In those 2 years he is going to save up for a deposit. Once when he saved a deposit over those 2 years his plan is to buy a house.
Is it that easy? He is over 300k in debt but his IVA is only a fraction of that. WIll he be able to obtain a mortgage that easily after 2 years?
How long do IVAs stay / effect credit ratings?
Thanks

Wutang_2

"How long do IVAs stay / effect credit ratings?" same as all credit history - 6 years and badly. Avoid at all costs.

papermoney

Luckily I have never been in that position and don't plan on having to ever make that decision to have an IVA.

Unfortunately our friend felt he had no choice. I just think he is being naive in thinking that he will be able to get a mortgage without a problem in 2 years.

peachyprice

Your friends credit rating will be ruined with an IVA, it has pretty much the same effect as bankruptcy and is recorded in the insolvency register.

10past6

Wutang wrote: »

"How long do IVAs stay / effect credit ratings?" same as all credit history - 6 years and badly. Avoid at all costs.

IVA's are applicable in certain cases, You really should do some research before making such staments, although I agree, some are widely miss sold.

Wutang_2

research what? this case or IVA's?? Either way IVA's are being advertised as government backed and as a logical viable option - this is no way the situation And when are IVA's the best way forward??? This case is regarding mortgages and with minimal thinking (research) an IVA will ruin any mortgage opportunities which had existed before. Blimey! Bad-advice-knocking-about alert. These comments are so misleading. "IVA's are applicable in certain cases" bejaysus

selectcase

You will get a mortgage if you have an iva settled 2 years ago, look at the criteria of some of the current sub prime lenders these mortgages still exist as long as you have a good deposit - personally i think its a good idea - sell the house, clear everything, all debts and live in a caravan or rent for a couple of years owing no -one. if you settle the iva straight away someone will provide a mortgage 2 years later but at a higher rate.

Gloster_Advise

selectcase has a good point that some lenders will accept IVA if satisfied, the longer the satisfaction the lower the rate and the more LTV you can get.

papermoney,
You are right in saying that your friend needs to get a deposit, and I would have though currently at least 15 maybe 20% deposit so i just hope they earn well!!!!

I have to back Wutang on this, IVA's do screw up peoples ability to re-mortgage or buy a house. i personally dislike like (at the moment) clients with IVA's as it is so hard to place them and get them a rate that is beneficial to them. DMP's seem to have a lesser effect as the credit accounts generally seem to be in default and no public information will show on credit searches. Not all people suit IVA's and not all suit DMP's. That is for those companies to advise and decide I think.

Regards
Si