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Are you Worried? Can You Get a Mortgage with an IVA?

Mortgage with an IVA

Being in debt and having a bad credit score are two of the factors that can increase the difficulty of getting a mortgage. Typically, the minimum credit score, required to get IVA, is 620.

Having Mortgage with an IVA can affect your credit score to quite an extent. So, can you get a mortgage with an IVA? If you apply for a mortgage while the arrangement is in effect, there is a high chance that it’ll get rejected. Moreover, if you already have one, you would have to contribute the money to repay your debt. That is a fundamental aspect of being a part of an Individual Voluntary Arrangement.

Even if you are qualified to get a mortgage, you can only get up to £500. To be able to get a higher amount, you’ll need written approval from your Insolvency Practitioner.

Now, let’s say that you’ve got the approval. This won’t make things better either, because you’ll have a hard time finding a good rate.

And, the idea of getting a mortgage during IVA isn’t such a good idea. It will only add to the debt you already owe. Thus, knowing more about IVA help you to get a better understanding of this matter and help you find a solution.

Experiences while Staying as a Mortgage Prisoners

The survey reports also state that there are various types of people who were mortgage prisoners who had a bitter taste of internal body trauma. They were nearly struggling in order to survive and repay the mortgage money. But sadly, the mortgage company didn’t allow them to have a certain deal that has a minimum value.

Some of their family is suffering for a longer span of time due to the extremely high rate of interest. In some cases, a mortgage prisoner’s dear one has already taken her last breath due to stress and anxiety. Someone in the same family is also suffering from depression and cannot work either. People are given certain prescriptions for antidepressants who are facing a difficult time with their mortgage loans.

This is not really the end, another woman who had to end her marriage once as her husband was the mortgage prisoner. Moreover, her husband couldn’t manage the repayment and that is the only thing responsible for such a devastating act. Lastly, the woman ended her life finally.  We can well understand from this very pathetic situation that mortgage loan repayment has played a huge and critical role in this downfall.

Reports of Survey Findings

There are reports that they have seen people suffering from mental trauma and eventually ending their lives. According to recent survey findings, a few mortgage prisoners sarcastically said that in the United Kingdom, the very certain amount of time that a person stays in prison is just the same as a time bomb. It will eventually explode after the time is over.

There are also some external factors that took place with some lucky prisoners. While staying in prison, most of their mortgages are overwritten by the United Kingdom government as the creditor expired due to some obvious reasons. In the UK, they are generally “Zombie” lenders, as usual, cannot offer someone new loans or credits upon assets.

Deal with your Mortgage Arrears by iva mortgage

When you have mortgage arrears, it is always better to deal with them as early as possible. Otherwise, the ultimate consequence of not paying would be implementing legal action. Since a mortgage is a secured debt, this could mean that you’re going to lose the property against which you had put as collateral. You might have intended to pay off the lender and get the asset back, but things don’t always go as planned.

How exactly will a Time Order come to your iva mortgage help?

When the lender takes you to court, you’ll have some options by which you can pay them and save your property from going into their hands. One such option is that — you can apply for a time orders for mortgage, provided that you fulfil the conditions for availing it. While using it, you can get additional time to clear your arrears.

Due to its formal nature, it has legal protection. That means the lenders won’t be able to pressurize you in any way during the time granted to you. A longer time would mean a reduction in the monthly instalments and easier clearing of mortgage arrears. Moreover, you can also have interest rates changed in some cases. However, everything about the arrangement would be decided by the court, based on your financial condition.

Get to Know More About Mortgage with an IVA

An individual voluntary arrangement is approved by the court and regarded as a formal agreement between a debtor and creditors. It allows the debtor to pay back the debts owed to multiple creditors over a period of time. It is quickly gaining popularity as a means of avoiding bankruptcy. iva mortgage option is available only to those people who have owed a debt to at least two creditors. Another criteria to be fulfilled is that the debt should amount to £10,000 at least.

How does it work?

When you face insolvency, you can opt for an IVA, provided that you fulfill the criteria. Since this is a formal agreement, you are required to appoint an Insolvency Practitioner. A debt repayment plan is made where the amount to be paid in each installment is decided. The arrangement comes into effect when the creditors give consent to the terms.

After that, the IVA practitioner manages all the debt repayment dealings with the creditors. In addition to the installment, you also have to pay a fee to the practitioner for his/her services. This fee depends on the amount of debt, and it is often too expensive. You are required to maintain a budget and adhere to it throughout the arrangement period. Any additional income or savings is contributed to your debt repayment.

How does it reduce the chances of getting a mortgage?

Having an IVA means that you are in a debt, you have insufficient assets to be able to settle. Can you get a mortgage with an IVA? Now, if you apply for a mortgage, you will have to mention the IVA. And, lenders would see this as a negative point. They will have doubts, whether you’d be able to repay their debt.

So, most of them would probably back out. Furthermore, the ones who remain will offer you a high-interest rate. Along with that, there wouldn’t be any scope of accepting the offer, because it would push you more into debt.

Is it necessary to mention IVA on a mortgage application?

When you appeal for a mortgage, the moneylenders may not immediately ask about IVA. But, they will surely ask you about your credit history. After you get an IVA, it will show for about five or six years on your credit history chart. And, even if you have applied for a mortgage, after a fixed period, you must not try to hide it. Can you get a mortgage with an IVA? Yes, but lying to the lenders would be called for unnecessary risk, that’s not worth taking.

What if you apply for a mortgage before IVA?

If you have applied for a mortgage before the IVA, that doesn’t seem to make things any better. You are already struggling to repay the multiple debts that you’re in. It won’t be a  wise decision to get into debt to yet another creditor. Can you get a mortgage with an IVA? Yes, go for it. The best thing to do would be to get the IVA and settle all existing debts. Only after that would it be sensible to apply for the mortgage application.

What if you’re required to remortgage?

During the end of mortgage with iva period, a debtor is often required to remortgage in order to pay the creditor. You might come across this situation as well. And this is the only time when applying for a mortgage during an IVA would be sensible. You won’t need any approval from the insolvency practitioner in this case. But, you would still have trouble finding a lender who accepts your application.

Objectives of RoundPoint Mortgage Servicing Corporation

RoundPoint Mortgage is one of the largest, fully integrated, non-banking mortgage servicing companies of the nation. It was established with a simple objective, which was- Delivering meaningful value to its customers and serving the homeowners all the homeownership needs.

Services Provided by RoundPoint Mortgage Servicing Corporation

RoundPoint Mortgage servicing corporation is famous for providing various kinds of mortgage services like-

  • Provides options for mortgage and origination payments.
  • Assets management services.
  • Loan restructuring and Collateral based loss mitigation
  • Solutions regarding loss mitigation and lending.
  • REO Management.
  • Full and Sub Servicing for homeowners and borrowers investors in the United States.

RoundPoint Mortgage servicing corporation is a licensed agency. It works as a sub servicer for the Commercial Banks, Mortgage Servicing Companies, Hedge Funds and for Credit Union also. As RoundPoint Mortgage servicing corporation provides various kinds of services, it becomes very tough to choose the aptest services among them. But there is nothing to worry about it. Because RoundPoint Mortgage servicing corporation has an expert consultant group for your help. Just visit them and they will make you understand which services are appropriate for you and why.

What about getting a mortgage after the IVA?

As we have seen, there is a very little chance that you’ll get a mortgage during the agreement period. But, the situation starts improving after you’ve completed the mortgage after iva period. The IVA will show in your credit history for about six years. It would also have done considerable damage to your credit score.

So, you might still face some trouble getting a mortgage. But, it would only get better from this point. Your credit score will improve with time. Eventually, you’d be able to get mortgages again at desirable rates and interests. You would still have to mention your mortgage after iva when asked. But, it probably wouldn’t matter much to the lender, if you’re in a good financial condition now. You would find many of them willing to offer you good rates.

Words from the Financial Authority of the UK

Owing to the Financial Authority of the United Kingdom for introducing a new set of rules. Those rules are helpful for the mortgage prisoners. The lenders will allow the mortgage prisoners to afford a certain amount of proportion on the mortgage.

It will only happen when they meet a few numbers of criteria. On the other hand, the changes can affect around just 6% of the mortgage prisoners. As a result, the lenders can show some respect and appetite to the prisoners.

Conclusion…

Getting a mortgage while on mortgage with iva seems to be quite difficult. There are very few lenders who would take the risk of receiving your application. The ones who do will offer high interests. On top of that, borrowing, while being knee-deep in debt, doesn’t seem sensible. So, now you are clear with your doubts — Can you get a mortgage with an IVA? Yes, you can. But, it would be best not to think about getting a mortgage before the IVA period is over. Only after you’re back in good financial condition is it worth applying for a mortgage again.

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