Get a mortgage after an IVA

An Individual Voluntary Arrangement (IVA) is a formal, legally binding agreement between you and your creditors to repay a portion of your debts over a fixed period, typically five to six years. An insolvency practitioner manages the arrangement, and during this time your creditors agree to freeze interest and stop taking further action against you.

When it comes to mortgages, an IVA creates several challenges. Most high street lenders view an IVA as a significant credit event, making it difficult to secure a mortgage through standard channels. The IVA is recorded on your credit file and appears on the Individual Insolvency Register, both of which lenders check during their assessments.

However, having an IVA does not permanently prevent you from getting a mortgage. The key factors lenders consider include:

• IVA status: whether your arrangement is active or completed
• Timing: how long ago the IVA was registered or satisfied
• Financial stability: your current income, employment, and spending habits
• Deposit size: how much you can put toward the purchase

Understanding these factors helps you plan your mortgage application at the right time and approach the right lenders.

Getting a mortgage while your IVA is still active is extremely challenging but not entirely impossible. Under the terms of most IVAs, you need written permission from your insolvency practitioner before taking on any new credit, including a mortgage. Borrowing more than a set threshold (usually around 500 pounds) without this consent could breach your IVA terms.

Even with your insolvency practitioner's approval, very few lenders will consider an application from someone with an active IVA. Those that do will typically require:

• A deposit of at least 20% to 25% of the property value
• Evidence of consistent IVA payments with no missed instalments
• A clear explanation of the circumstances that led to the IVA
• Proof of stable income with affordability headroom beyond your IVA contributions

Some specialist lenders may consider your application if you are in the final year of your IVA and can demonstrate strong financial management. In most cases, waiting until your IVA is completed will give you access to better rates and a wider range of lenders.

Once your IVA has been completed (also called "satisfied"), your prospects improve significantly. A satisfied IVA shows lenders that you honoured your commitment to repay debts, which is viewed more favourably than an IVA that was failed or terminated early.

The timing of your application matters considerably:

Immediately after completion: some specialist lenders will consider applications straight away, though rates will be higher and deposit requirements larger.

One to three years after completion: more lenders become available as time passes, and rates begin to improve. Maintaining a clean credit record during this period is essential.

Three to six years after completion: your options continue to widen. Once the IVA drops off your credit file entirely (six years from the start date), you will have access to a much broader range of products.

Your circumstances also play a role. Lenders will assess your current income, employment stability, outgoing commitments, and whether you have rebuilt a positive credit history since the IVA ended. A consistent track record of responsible borrowing, such as a credit card used and paid off monthly, strengthens your application.

An IVA is recorded on your credit file for six years from the date it was registered, not from the date it was completed. This means that if your IVA lasted five years, it may only remain on your credit file for one year after completion. If your IVA was extended or lasted the full six years, it could drop off your credit file around the same time it ends.

The IVA also appears on the Individual Insolvency Register for the duration of the arrangement and for three months after completion.

Understanding this timeline helps you plan when to apply. Checking your credit report before applying ensures you know exactly what lenders will see and allows you to correct any errors that could affect your application.

The deposit you need depends on how recently your IVA ended and which lender you approach. Generally, borrowers with a history of insolvency need a larger deposit than those with clean credit. A larger deposit reduces the lender's risk and can help you access better interest rates.

If you are planning ahead, building your deposit while your IVA is still active or recently completed gives you a stronger position when you are ready to apply. Some lenders may accept gifted deposits from family members, though they will still assess your income and affordability independently. Your broker can advise on which lenders are most flexible with deposit sources for applicants with a history of insolvency.

High street banks such as HSBC, Barclays, and NatWest typically decline applications from borrowers with an active IVA or one that was completed less than three years ago. Their automated credit scoring systems flag insolvency events and often reject applications outright.

Specialist lenders and building societies are more likely to consider your application. These lenders assess cases individually rather than relying solely on credit scores. They include:

• Specialist adverse credit lenders: these specifically cater to borrowers with IVAs, CCJs, defaults, and other credit issues
• Smaller building societies: many use manual underwriting and consider each application on its merits
• Private banks and niche lenders: these focus on the strength of your current financial position rather than past credit events

Because many of these lenders are not available directly to the public, working with a specialist mortgage broker is important. A broker with experience in adverse credit can match your circumstances to the right lender, present your application in the best light, and avoid unnecessary credit searches that could further impact your score.