If you rent a house or flat it should not be affected if you start an IVA. However there may be implications if you decide to move to a new property.
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- Can you continue to rent your house if you start an IVA?
- The implications of moving to a new rented property
- Will your Credit Rating stop you moving?
Can you continue to Rent your House if you start an IVA?
Starting an IVA will not affect your ability to continue to live in a property you are currently renting. Your landlord will not be told. As such as long as you continue to pay the rent on time you should have nothing to worry about.
Your negative credit rating will not affect your landlord’s property. A property cannot be blacklisted. It is the individuals who live in the property who can have a poor credit rating but not the property itself.
The Arrangement might actually improve your relationship with your landlord. Once the Arrangement is in place you should always be able to pay your rent on time because the required cash is budgeted in your living expenses.
It is unlikely that anyone will ever discover you are in an IVA unless you tell them.
The Implications of moving to a New Rented Property
A monthly payment IVA will normally last 5-6 years. During this time there could be many reasons why you might need to move to a new rented property.
In theory there is nothing to prevent you from doing this. However if your new rental payment is either higher or lower than the amount you previously paid it will affect the Arrangement.
If the rent is higher your living expenses budget will increase. You may not be able to afford this without reducing your IVA payments. It might be possible to do so but the agreement may have to be extended as a result.
If your rent falls after moving to a new property and your disposable income goes up as a result you may have to increase your IVA payments .
Will your credit rating stop you renting a new house during an IVA?
Once you start an IVA your credit rating will become poor. This will cause problems if you want to move and rent a house or other property using a letting agent during the Arrangement.
The issue is most letting agents will credit check you. You will fail this because of your IVA. As such it is usually best to be upfront with the agent about your situation. If it is going to be a problem there are some things you can offer to overcome this.
You could suggest paying rent 6 months in advance. However given your financial situation this is likely to be difficult. Alternatively you could offer a Guarantor. This could be a family member or friend who confirms they will pay your rent if you are unable to do so.
Your poor credit rating will not normally be taken into account if you are planning to move into a rented property owned by the Council or local Housing Association.