Lynsey, A housing home loan is the biggest purchase that anyone will make. With prices so keen there are opportunity to be had in the next five years. Like you said how does the Bank handle lending to ex iva people. No one really knows....but no one should go for a 8% loan as quoted now in a time of bust? Ridiculous rate. As base rate raises as the economy gets better, those rates might raise even further.
The purpose of an IVA is to remove the toxic debt you have, and restore your cash flow like a new business. But if that means reduced lending opportunities then that needs to be fleshed out as its not fun to be debt free and not get a resonable priced loan.
Even for those who have a house the need to upgrade through a new re mortgage loan might be hampered by the IVA past.....one could be boxed in....not what I expected but is apparently so. This takes the sheen out of an IVA. Again its all about the Banks!
kalla wrote:
Lynsey, A housing home loan is the biggest purchase that anyone will make. With prices so keen there are opportunity to be had in the next five years. Like you said how does the Bank handle lending to ex iva people. No one really knows....but no one should go for a 8% loan as quoted now in a time of bust? Ridiculous rate. As base rate raises as the economy gets better, those rates might raise even further.
The purpose of an IVA is to remove the toxic debt you have, and restore your cash flow like a new business. But if that means reduced lending opportunities then that needs to be fleshed out as its not fun to be debt free and not get a resonable priced loan.
Even for those who have a house the need to upgrade through a new re mortgage loan might be hampered by the IVA past.....one could be boxed in....not what I expected but is apparently so. This takes the sheen out of an IVA. Again its all about the Banks!
Takes the sheen off the iva but anyone entering an agreement should be well aware of the downsides. You dont get nothing for nothing.
Discharged today the 8th feb 2012. View is much brighter now.
Continuing to rebuild our credit worthiness.
Plasticdaft, there has never been any word from any Bank that anyone going Bankrupt or IVA cannot get reasonably priced home loans once they are debt free. You are making a presumption that 'you get nothing for nothing',what is this nothing for nothing quip???? If you are debt free then you are not at risk.....an upside not a downside so please explain??
It is a well known fact that entering into an IVA will have an adverse effect on your ability to gain future credit.
The plus side of an IVA is that part of your debt may be written off,thats what I meant about getting nothing for nothing.The other plus side is that you do not have to suffer sleepness nights caused by creditors constantly phoning you.
As for being debt free meaning you are no longer a risk,that is a matter of opinion. Banks have to base lending decisions on something,and currently like it or not that something is a credit report.
I agree that companies shouldnt be allowed to charge an arm and a leg for subprime loans etc,especially if someone has stuck to the payment plan of a 5 year IVA,clearly this alone would hint that a re-education had taken place with regards to managing money.
Discharged today the 8th feb 2012. View is much brighter now.
Continuing to rebuild our credit worthiness.
quote:
"It is a well known fact that entering into an IVA will have an adverse effect on your ability to gain future credit"
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What do you mean future credit? within the five years or after.....?? If it it after your IVA then its not a well known fact as you are the only person to have said it with certainty??
quote:
Banks have to base lending decisions on something,and currently like it or not that something is a credit report.
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So what does your credit report say after your five yrs of an IVA other than you have settled your debts.IVA finished. Does it say you are at risk?? What is in this report you alluding to that turns lenders away?
Last edited by kalla on Wed Jan 21, 2009 12:21 am, edited 1 time in total.
Once the six years is up and all defaults/IVA's drop off your credit record, then you should be no worse off than someone who has never been in one, and be able to get credit if you want it.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
Life is about risk and managing that risk, whether you are an individual, a small business, a large financial institution or whatever.
Unfortunately, banks will assess risk and lend to their own criteria at rates that they consider prudent for them, regardless of what anyone may say or think about it. If they want to impose a higher rate on someone who has been in an IVA then they will. The choice, and therefore risk, for the individual is whether they accept it or not. In a case where the 6 years has gone and there is no record of the IVA, they are still likely to impose conditions or penalties of some sort, for example a very large deposit/existing equity to get best rates, or higher rates for lesser deposits/equity. Whatever your thoughts are on whether that is fair or not there isn't much that we can do to change it, it is purely down to the lenders themselves.
Regards.
Cert DR
23+ years in debt advice
I do not post for anyone other than myself
Sadly all the banks seem to be treating everyone with the same way at the moment. Weather you have had a IVA or gone BK. Now I am not a risk I have plenty of equity in my house and have never missed a mortgage payment. However I think I must have rung most of the banks in the county over the last few weeks. As soon as I mentioned that I had completed a IVA they did not want to know. They would not even let me apply. They treat it like some kind of sickness at the moment. We were told by our own bank that they would have a good look at giving us a mortgage one it had been completed a year. I called them to arrange a meeting only to be told that as of December they would no longer touch IVAs at all. It would seem at the moment that if you have had a IVA you stand no chance of getting a mortgage. Even if you can you will be paying sky high rates.
Yes I had some money troubles but they have been sorted out. The ways the banks of working now why should I let them keep my money. I might as well keep it in a hole in the ground.
Has your IVA dropped off your record yet? If not, that could be why they won't look at you.
If the six years was up, I wouldn't volunteer the information unless it was a specific question.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
No its got 5 years to go yet. But at the time we arranged it we were told that a IVA would not be to much of a problem with getting a mortgage. I could understand if we were a risk but we are less of a risk then someone who has say £40000 on cards and loans and has not sorted out their problem.
Stupid isn't it? I do get annoyed that those of us who are doing something about our debts get penalised, whilst those whose heads are firmly stuck in the sand, still get money thrown at them.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
Having been advised that if I try and take out a mortgage at the moment I will looking at rates between 8-11%. Yet a few days ago our bank gave us a overdraft and new debit cards. I was also advised it might help if I set up a account in just my name and our main account is a joint one. I tried HSBC now I believe they are one of the hardest banks to get a account with. Have just a had letter from them saying they will give me a account with overdraft ect. Now its not that I will use the overdraft but any credit now used wisely will improve my credit score. Also when I asked HSBC about a mortgage they did not laugh me of the phone so there might just be a glimmer of hope there.
The rate you have is higher than the norm even for fix rates now - 7% is very max with a deposit to cushion against negative equity. You could hold on till the rates improve as 7% was the 'subprime' rate before base rate came down.
House prices are down but getting a decent loan isn't.What a reversal from only two years!
