Repair Credit Rating after IVA

Repair Credit Rating after an IVA After your IVA has finished your credit rating will repair naturally over time. However there are things you can do to speed this up.

Want further help and advice? Give us a call (0800 077 6180) or complete the form below to speak to one of our experts

When is the Record of your IVA removed from your Credit File?

An IVA does not end on the date you make your last payment. It is legally finished only once you receive a Completion Certificate. This is written confirmation from your Insolvency Practitioner (IP) that your IVA is over.

It normally takes 2-3 months after your payments have ended for your Certificate to be produced and sent to you. Only after it has been received will your details be removed from the Insolvency Register.

At this point you are no longer insolvent. As such you can now start the process of improving your credit rating.

The record of your IVA remains on your Credit File for 6 years from its start date regardless of when you get your Completion Certificate. After 6 years the record is removed automatically.

Review Default Notice and CCJ Dates

It is possible that one or more of your creditors issued a Default Notice or CCJ (County Court Judgment) against you after the start date of your IVA. You can check whether this has happened by reviewing your credit file.

Where they have been issued these records also remain on your credit file for 6 years. If they were issued after the start date of your IVA they will continue to affect your credit rating after the IVA record is removed.

To avoid this you can ask the lender to change is Default Notice or CCJ issue date to no later than the IVA start date. You should make your request in writing to the lender’s Data Controller.

If you would like a template letter which can be sent to Data Controllers please contact us. We will e-mail it to you.

If the lender persists in not changing the date of their Default or CCJ you can complain to the Information Commissioner. They have the power to force the lender to make the relevant changes.

Start using a Credit Repair Credit Card

Six years after starting an IVA all records of the debts you included will be removed from your credit file. As such the file then shows no history of responsible credit usage. This situation is almost as bad as having a poor credit history.

The problem is that potential lenders have no idea whether you might be a risk to lend to or not. As such they are likely to reject any application for credit from you. This situation can be overcome by using a “credit repair credit card”.

These cards are available to people with poor credit records or no credit histories. Using one for small purchases and paying the balance in full each month will start to build up a positive history of credit usage on your file.

The interest charged by credit repair card lenders is very high. To avoid paying this make sure that you pay off the balance in full at the end of each month. Such repayments provide clear evidence of responsible credit usage.

Getting a Mortgage after an IVA

Your credit rating may remain poor for some time after you have completed an IVA. However you do not have to wait until it is repaired to get a Mortgage.

Whether you want to buy your first property or are currently a home owner there are mortgage companies who will consider lending to you. However there are a number of criteria you need to be aware of.

You will need a deposit. The longer it is since your IVA started the smaller the deposit that will be required. In addition the amount you want to borrow must be affordable in the context of your income.

After you have been through an IVA the interest charged on the mortgage you borrow is likely to be higher than for someone who has not had debt problems in the past.

Finished your IVA and want to get a mortgage? Give us a call (0800 077 6180) or complete the form below to speak to one of our experts

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