can I take out a mortgage if I'm doing an IVA

[natalie]

I'm currently on a debt management plan - but am hoping to be able to sign on a joint mortgage with my boyfriend. Will this effect my repayment plan, which I can't afford to jeopardise?

[Oliver]

Natalie, your options really depend on whether you are in an informal debt management plan or a formal IVA. If you an informal plan, then the only thing you need to watch out for is that it is likely that your credit rating will be effected. As such, this might effect the type of mortgage you and your boyfriend are able to get. However, once you have a mortgage, as long as you can afford to make the mortgage payments as well as the monthly plan payments, there should be no problem.

If you have an IVA, then you should NOT enter into a mortgage without first agreeing this with your IVA supervisor as there could be other ramifications. Your supervisor will advise you of these.

Hope this helps


James Falla
www.thomascharles.com

[natalie]

Hi, many thanks for your help James. [:)]
I am currently on an informal IVA... can it be changed into a formal IVA as I have decided against entering into a mortgage until I am sorted out. I am feeling that it would be better to straighten myself out before entering into potentially more problems!

[Oliver]

Natalie,

You can certainly move from an informal plan to a formal IVA. This would possible be of great advantage as your debts can be settled in 5 years where with your informal plan you could be paying for much longer. Also interest and charges will be frozen

The availability of the IVA will depend on your situation. An IVA is really only workable if your total unsecueerd debts are £18k + and you have a monthly disposable income of £250.

If you would like further information about IVAs or other debt solutions, please feel free to contact us.

James Falla
www.thomascharles.com

[natalie]

Thanks James
I owe just over £25,000.
My disposable income is £200.. not quite enough [:(]
However, my boyfriend has suggested that he make up the difference. I am worried that he might not last the course. He assures me that he is only too willing to help on a long term basis, and asks if there is a way of formalising his share of the payment to put my fears at rest?

[Oliver]

There is no reason why your boyfriend can not help you with iva contributions. Unfortunately, there is no way of legally tying him into this that I know of - at least not that you would realistically be able to enforce..... You would have to make you own decision as to whether he can be trusted to stay the course. However, note, if you enter into an IVA and then fail because you split with your boyfriend and he stops paying, then you will be liable for all the debt and may have to go bankrupt.

If you would like further information about IVAs or other debt solutions, please feel free to contact us.

James Falla
www.thomascharles.com