Being credit checked whilst in an IVA

There's no doubt about it, entering into an IVA will have a serious impact on your credit rating.

If you were have a credit check done during the course of your IVA, the chances are very high that the credit check would reveal the IVA on your file.

Credit Checks In An IVA

There are several reason why someone might be subjected to a credit check during an IVA, but the most common reason would be as a result of searching for credit.

Under the terms of the IVA, there's a requirement to refrain from obtaining credit of more than £500 for the full duration of the IVA, and failure to comply with this condition could lead to the IVA being failed.

If you are in need of credit during your IVA, you should get in touch with your Insolvency Practitioner. They have tools at their disposal which could reduce the need for you to borrow money, including giving a payment break to the IVA.

Self-employed credit

Exceptions to the zero credit rule do exist. The self-employed can seek permission from their Insolvency Practitioner to allow access to trade accounts with suppliers which, for many, is an essential requirement for their business cash flow.

If agreeable, it's probable that the Insolvency Practitioner will want to monitor the credit arrangement, to ensure the account is being maintained responsibly.

Property credit checks

It is not unusual for prospective tenants to be exposed to a credit check when they are applying to move into new rented accommodation.

This can create a difficult situation for those tenants in an IVA as the credit check will probably reveal their historic credit problems.

More often than not, the IVA will not impact on the chances of securing the property, but it may be the case that the new landlord increases the size of deposit they require.

Professional IVA Advice

If you are considering entering into an IVA and would like to have a chat with an IVA specialist, please call 0800 088 7502 or complete this form and one of our advisers will contact you at your preferred time.

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