Rent a House during an IVA

Rent a House during an IVA

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?

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.

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58 thoughts on “Rent a House during an IVA

    Cora says:

    Hello James may i know if you are able to rent a property in any letting agent with an IVA

    Many thanks

      Hi Cora

      Different letting agents have different criteria. I have come across some that seem to be OK if you have an IVA as long as you can offer a guarantor. Others say no. Unfortunately it seems to be totally hit and miss I am afraid.

    Suz says:

    Hi I’m looking to rent a house. I have had a iva terminated due to the way it was being run by the company. I have the termination email but it obviously stays on my report for 6 years. will this still be a bad thing on my credit file even though it is over?

      Hi Suz

      Even through your IVA is terminated, as you rightly say the record will remain on your credit file for the full 6 year term. This means your credit rating will remain poor for this length of time. As such you will still struggle to pass a letting agent’s credit check I’m afraid.

    Tom says:

    We going through the IVA process and our letting agreement renewal due in next 3 months, we have been in this property 3.5 years, would this IVA affects renewal agreement or just when you signing freshly new contract for moving in ?

      Hi Tom

      If all you are doing is renewing a current letting agreement, it would be very unusual for the agent to do a new credit check on you. Given this they will not become aware of your IVA or poor credit rating and you should have no problem at all.

    Michael says:

    Hello. Are lettings agents able to check how much is on your iva or is that confidential information?

      Hi Michael

      There is no way a letting agent can review the details of your IVA. This is not public information. If they carry out a credit check they will see your credit rating is poor and may discover that you have an IVA running. But that is it unless you yourself decide to provide them further details.

    Gillin says:

    I rent my house from my son. If I have bad debt, will it affect my sons credit score?

      Hi Gillin

      You don’t have to worry, a property can’t be blacklisted if someone living there has a debt problem. If your credit rating is poor and you are renting your house from your son, neither his property or him personally will be affected in any way.

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