How long do I have to declare an IVA?
Summary: This article will explain how long an IVA will have to be declared when applying for future credit, as well as the length of time it will remain on an individual’s credit record.
When entering an Individual Voluntary Arrangement, it is the responsibility of the IVA Supervisor to inform the credit agencies on behalf of the debtor. As soon as they the IVA begins, it will appear on the individual’s credit file, which is available to anyone who needs access, such as future credit lenders, or even employers.
How long does an IVA remain on the credit file?
It is usual for the IVA to remain on file for a period of 6 years (assuming the IVA is for 5 years). This means that even when the IVA has been successfully completed, it will still be recorded for a further 12 months.
Do I have to declare an IVA to future lenders?
Whilst an IVA appears on an individual’s credit record, they are required to advise any potential lender of the fact, even when the IVA has been completed. As the IVA will remain on the credit file for 6 years, even if the IVA was completed early, it will still need to be declared for this duration.
Do I have to declare an IVA when it has been removed from my credit record?
Once an IVA has been completed, the IVA supervisor will send a Certificate of Completion to the credit agencies. After a further 12 months (assuming the IVA was for 5 years and not completed early) they will remove the IVA from the credit record. When applying for further credit, it is not compulsory to advise a lender of the previous IVA.
Once removed from my credit record, do I need to disclose I have been in an IVA if a credit application asks if I have been previously made bankrupt?
An IVA is not the same as bankruptcy, so assuming the fact has been removed from the individuals credit record, there is no need to disclose the information.
Once removed from my credit record, do I need to disclose if I have been in an IVA if a credit application asks if I previously been insolvent?
Insolvency is the term used when an individual, or business, is unable to repay their debt obligations after all essential expenditure has been made (i.e. income does not cover outgoings). As one of the criteria for IVA eligibility is that the applicant must be insolvent, and then they would need to disclose this fact when applying for future credit if asked (even if the IVA has been removed from the credit record). The same is true if asked if the applicant has ever entered an IVA agreement. Because a credit application/agreement is a legal document, failure to disclose this information if asked could invalidate the agreement. In the case of a mortgage, for example, this could lead to repossession of the property. It is possible that there could be a timeframe included within the question (e.g. Have you entered an IVA in the last 5 years?). Assuming that the IVA was completed before this time, then it would not need to be declared.