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When deciding whether to get an IVA, it’s natural to ask questions regarding how this arrangement will affect you and your life. The good news is, if you’re currently renting a property, an IVA shouldn’t have much impact.
As they are classified as unsecured debt, rent arrears from previous tenancies could be included in an IVA. Problems may arise though if you try to include outstanding rent from current properties. In this situation, it would be more beneficial for the landlord to simply evict you and find a new tenant rather than receive payments through an IVA.
However, your current rental agreement will be taken into consideration by your insolvency practitioner. When monthly repayments are being set up, they will form part of your priority bills. Therefore, you will typically have enough left over to make your repayments.
Ultimately, the majority of your creditors (including landlords) have to agree to the IVA before it’s approved. If those who own more than 75% of your total debt sign up to the terms than rent arrears will be included. If not, you may need to find an alternate solution.
If you’re currently renting a property, an IVA should have absolutely no impact whatsoever. As long as you continue to make the payments to your landlord, there should be no issues.
While the IVA is active, you may find it harder to rent a new property. Initially though, if you wish to move, you’ll need to inform your insolvency practitioner. When the IVA was set up, your current living expenses would have been considered. If your rent is higher or lower than what you’ve been paying, this will affect your monthly repayments.
Consequently, adjustments may need to be made to the IVA so you can complete the move.
It’s also worth considering that landlords will usually check your credit report before agreeing to hand over the keys. During this investigation, they will spot your IVA. Although this demonstrates you’re taking action to resolve your debts, a landlord will also see you’ve had problems repaying creditors.
Consequently, they may refuse your tenancy request.
Given an IVA is active for at least five years, it’s quite likely you will move house at some point. Fortunately, there are many landlords out there who should be willing to accommodate you.
After the IVA is complete, it will stay on your credit report for at least another year. Even after this period, your credit score is likely to be poor. Therefore, you may – in the short term – have problems securing rented accommodation.
This shouldn’t be the case forever though. Although there are landlords who will be willing to help you, your credit score will eventually improve if you manage to stay on top of your debts and make payments on-time.
Ultimately, renting after an IVA shouldn’t become a problem.
If you have any questions about renting with an IVA, feel free to get in touch. Regardless of your circumstances, our team hear about situations such as yours every day. They don’t judge or patronise, they are just here to help.
To find out if an IVA could benefit you, contact us today. With just a few clicks, you could get on the path to regaining control of your debts:
Debt write off applies to unsecured debts and on completion of an IVA. A debt write off amount of between 20% and 80% is realistic, however the debt write off amount for each customer differs depending upon their individual financial circumstances and is subject to the approval of their creditors.
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