An IVA agreement is basically an individual voluntary agreement that allows a holder of a debt that is overwhelming, to find an amicable solution of repaying the debt.
An IVA is normally found to be a good solution to a personal debt crisis. There many people across the UK who have benefited from IVA agreements that have proven to be a life saver. An IVA agreement is basically an individual voluntary agreement that allows a holder of a debt that is overwhelming, to find an amicable solution of repaying the debt. One of the consequences of the IVa agreement is that it will hurt the applicant’s credit ratings.
So, what happens to a holder of an IVA agreement or previous holder of such an agreement who wishes to purchase a home? There is a special facility provided for people in such circumstances. It is referred to as an iva mortgage. An iva mortgage is a mortgage facility that is advanced to holders or previous holders of an IVA agreement. The purpose of the iva mortgage facility is to enable the holder purchase an affordable home for themselves.
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There are certain financial organizations that provide iva mortgage services to holders of IVAs.
This they do despite the fact the IVA holder has an adverse credit rating and is considered a financial risk. The mortgage is designed to accommodate this fact. While holders of an IVA will be financially challenged due to the monthly payments towards the IVA agreement, they may still apply and qualify for an iva mortgage.
The iva mortgage comes with certain conditions. If the applicant has had the IVA agreement for at least 6 months and has been faithfully making the monthly payments as stipulated, then they may get about 50 per cent funding as their iva mortgage. The interest rate charged will be much higher because of the considerable risk that IVA holders are perceived to be.
Previous holders of IVAs may get funding of up to 60 per cent of the value of the property to be purchased. The loan to value ration is considerably much lower than for other applicants. Though the applicant will be stretched out financially when buying a home under such an agreement, the opportunity to own a home is considered a privileged one and taking up such an opportunity should be considered a wise investment choice.