Individual Voluntary Arrangement Mortgage

Individual Voluntary Arrangement Mortgage

If it is becoming a struggle to cope mounting living costs and you are finding it hard to adhere to monthly repayments on your mortgage, credit cards and bank loans, a debt plan known as an Individual Voluntary Arrangement (IVA) may be your way out of debt.

If your debt totals over £15,000 to three or more creditors, you have a regular monthly or weekly income and can afford to repay £200 then an IVA should be considered. They work by consolidating your monthly repayments in to a more manageable sum better suited to what you can afford. Once approved the agreed payment is paid in to the IVA over a 60 or 72 month term and divided amongst your creditors, the company working on your behalf initiate all contact with your creditors meaning you no longer have to talk or interact with them.

An IVA must be put in place and supervised by qualified licenced practitioners due to the fact that it is a legally binding contract. These supervisors oversee every stage of the Individual Voluntary Arrangement making sure creditors are paid and that the terms and conditions are still relevant and are being followed correctly. Whichever company is working on your behalf will take a fee for their work; this is not added to your repayments but taken from the amount which creditors receive. Their fees do not affect your repayment figure in any way.

Advantages and Disadvantages

Individual Voluntary Arrangement Mortgage

It is still possible to get an Individual Voluntary Arrangement mortgage. IVA`s do not prevent people from obtaining a mortgage, it should be said that in can be very difficult as you will be seen as a high risk candidate by lenders. You will also be subject to high interest rates. If you are looking to gain an Individual Voluntary Arrangement mortgage you should seek help from a broker who can provide you with the best deals on the market, these would require a fee for their work.

When looking for an Individual Voluntary Arrangement mortgage it is advised to wait until the IVA has ended and for your credit rating to improve to give you the best chance.

Individual Voluntary Arrangement Mortgages and Assets

The terms of an IVA mean that if you own your home or have a mortgage you are under no threat of being repossessed.

Mortgage owners may be required to release any equity in your home should you have or should any become available in the future. This would then be repaid to creditors.

Your assets are also protected in the terms of an IVA, however more expensive items owned such as cars, motorcycles or boats may have to be sold and replaced by a lower cost alternative.

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