Can I get a mortgage after my IVA ends?

Q I have an individual voluntary agreement (IVA) which is due to finish in May 2006. Will I be blacklisted for ever after? For example, will I ever be allowed to take out a mortgage?

JO

A An IVA is a legal process that enables those in debt to come to an arrangement with their creditors for repaying some or all of the money they owe. It also prevents any further interest accruing on what they already owe.

An alternative to bankruptcy, the IVA has several advantages as a route out of debt. For starters, it is generally cheaper to arrange and it does not leave you subject to the restrictions of a bankrupt, such as not being able to obtain credit or hold certain jobs.

But the major advantage of an IVA over bankruptcy is that, once the IVA ends, your credit rating should actually be repaired by virtue of having undertaken the agreement.

This makes you a much more promising customer for mortgage lenders as you will have clearly demonstrated that you are prepared to deal with financial hardship when it occurs.

Even mainstream lenders such as Halifax now consider borrowers with previous debt problems but there are several specialist lenders, including Platform Home Loans, Preferred Mortgages and Birmingham Midshires, which offer mortgages to customers who have a less than sterling credit history. These loans are variously classed as impaired credit, adverse credit, full status or sub-prime loans.

However, it is highly unlikely you will need a specialist lender by the time your IVA ends so - provided you meet a lender's other borrowing criteria - you should have no difficulties securing a mortgage.