Future Credit

[Phil1024]

I was wondering as I keep on hearing different information from various sources. What effect does an IVA have on my credit rating once the 6 years have been completed and my name is taken off the register?

[Phil1024]

Also would I have to state I was in an IVA afterwards?
Would I always have to go to a mortgage provider who deals with people in our situation?

[Adam Davies]

Hi
Your credit record should be clear after the six years are up but as you will then have no history of taking credit you will have to slowly build up your credit score.
Start with club books etc
When appling for a mortgage you will find that a standard question will be "have you ever entered into an insolvency agreement with a creditor" and you will have to answer yes.I would imagine that many High st lenders will decline an application but there are many sub prime lenders happy to deal with ex IVA people.
Maybe Welsh boy can give his experiences on this point.
Regards

Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

[Phil1024]

Cheers Andy thats what I thought would happen. I presume this means that even though I needed it at the time an entering into an IVA, it will effect me for the rest of my life with regard to getting the better rates of interest both in a mortgage and loans.

[Welsh Boy]

phil1024

Yes the rate will reflect the fact that you have IVA on your credit file, but you may be pleasantly surprised at the rate offered. Many high street lenders are looking to take on this type of business. Hope this helps -Tony

[Phil1024]

Cheers Tony, I'm glad you could advise so really you don't see much difference between someone who had an IVA and someone who never entered one with regard to rates. Do all mortgage providers ask if you have ever been in an IVA?

[Welsh Boy]

phil

The point I am making is that you won`t be hammered rate wise, the rates are not exactly what you would get with a clean credit history but are not miles away from them. Yes a part of all application forms that I have seen ask for your credit history and whether you have had ccj`s iva etc. Standard stuff Phil. Tony

[Phil1024]

Would it be the same with other forms of credit, ie secured loans, car finance, etc after the 6 years?

[MelanieGiles]

If the applications ask the question Phil, you have to answer it. But it is rarely held against you for those type of loans.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[Welsh Boy]

Phil

As far as I am aware it would be a consideration on all credit applications. Tony

[ordinary_world]

Hi,
Is the effect of BR and IVA on your credit record the same then? Or do creditors differentiate?

Best

OW

- 'I wont cry for yesterday 'cause there's an ordinary world somehow I have to find...'

[Adam Davies]

Hi
Just to clarify.
On most mortgage applications,as Tony also states,you will be asked if you have "ever" entered into an insolvency agreement with your creditors.Even after the six years when the IVA is not on your record you will have to answer yes and gve details[end date and a copy of certificate R.5.34 to show that it,s satisfied].
On most personal applications for unsecured borrowing you will be asked have you any CCJ or adverse credit but as you will have completed your IVA and these will be satisfied you can happily tick NO.
It will depend on the actual wording on the proposal.
To answer Ordinary Worlds question I would say YES most credit companies see an IVA in the same light as bankruptcy when dealing with unsecured credit.
Mortgages are not as particular and as Tony has said rates are very,very competitive in the sub prime market.
Regards

Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp

[ordinary_world]

Many thanks Andy.

So I'll be relegated to sub-prime lenders, such as GE Money Home Finance, for life?! No more Alliance & Leicester, Nationwide or Halifax? Not a good prospect!

I thought the whole point of IVAs was debt forgiveness - doesnt sound as though prime lenders are very forgiving.

Best


OW

- 'I wont cry for yesterday 'cause there's an ordinary world somehow I have to find...'

[Adam Davies]

Hi
I think that the better the rate the better your credit standing has to be.
Don,t be put off though because to be totally debt free in five years is a huge plus against paying an extra 1 percent for your mortgage.
Regards







Andy Davie
IVA.co.uk Spokesperson

About me:
http://www.iva.co.uk/andy_davie_profile.asp

IVA Helpline: 0800 197 4838
http://www.iva.co.uk/iva_helpline.asp