Mortgage-Ready in 2025: Steps for Buying a Home After an IVA or Bad Credit
Steps to Becoming Mortgage-Ready: What to Do if You’ve Had an IVA or Bad Credit
Buying your own home can feel like standing at the bottom of a very tall mountain and looking up. You know the view at the top would be worth it, but right now, all you can see are the obstacles in the way. If you’ve been through an IVA, struggled with bad credit, or made financial mistakes you wish you could undo, that feeling can be even heavier.
You might be thinking, “People like me don’t get mortgages.”
Or, “I messed up once, so I’ll never be trusted again.”
If that’s where your head is right now, let me say this clearly: your past does not disqualify your future. It might slow the journey down. It might mean taking a different route. But it does not shut the door on homeownership.
I’ve seen — and spoken to — so many people who believed buying a home was impossible after an IVA or bad credit. Single parents. Couples rebuilding after redundancy. People who were financially responsible for years, hit one rough patch, and watched everything unravel. And yet, step by step, they found their way back.
This post is for you if you’re trying to make sense of what comes next. Not just the technical rules, but the real-life process of becoming mortgage-ready when your financial history isn’t perfect. We’ll talk honestly about how lenders see IVAs and bad credit, what you can do right now, and how to move forward without beating yourself up over the past.
This isn’t about quick fixes. It’s about progress, patience, and putting yourself back in control.
Understanding How IVAs and Bad Credit Affect Your Mortgage Options
Before you can move forward confidently, you need clarity. One of the hardest parts of having bad credit or an IVA isn’t just the financial impact — it’s the uncertainty. Not knowing where you stand. Not knowing if it’s even worth trying.
An IVA (Individual Voluntary Arrangement) is a formal agreement with creditors to repay debts over a set period, usually five or six years. For many people, it was the lifeline they needed at a time when everything felt overwhelming. But while an IVA can help you regain stability, it does leave a lasting mark on your credit file.
Bad credit can include missed payments, defaults, CCJs, payday loans, or accounts falling into arrears. Often, it’s not one big mistake but a series of small ones during a stressful season of life — illness, job loss, relationship breakdown, or caring responsibilities.
From a lender’s perspective, your credit history tells a story. They use it to answer one question: how risky is it to lend to you?
What lenders see — and why it matters
If you’re currently in an active IVA, the reality is that almost all mainstream mortgage lenders will decline your application. It’s not personal. It’s policy. An active IVA signals ongoing financial difficulty, and lenders want certainty.
Think of it like this: applying for a mortgage while still in an IVA is like trying to convince someone you’re ready to run when you’re still healing from an injury. It doesn’t mean you’ll never run again — just not yet.
Once your IVA is completed, things begin to change, but not overnight.
An IVA remains on your credit file for six years from the date it started, even if you finish it early. During that time, lenders can still see it, although its impact lessens as time passes.
Here’s the key thing many people don’t realise: completion matters, but time matters even more.
A lender is far more comfortable with someone who completed an IVA three or four years ago and has managed their money well since, than someone who completed one six months ago but hasn’t yet demonstrated stability.
Deposits and how they change over time
One of the biggest differences for people with an IVA or bad credit is the deposit required. Lenders often ask for a larger deposit to offset perceived risk.
Here’s a realistic guide:
| IVA or Credit Status | Typical Deposit Required |
|---|---|
| Ongoing IVA | 30%+ plus funds to clear IVA |
| IVA completed under 1 year ago | Around 20% |
| IVA completed 2–3 years ago | Around 15% |
| IVA completed over 3 years ago | Around 10% |
This isn’t meant to discourage you — it’s meant to give you something solid to plan around. When you know what’s expected, you can work towards it with intention instead of guessing.
Yes, the interest rates may be higher at first. That’s frustrating, but it’s also temporary. Many people refinance later, once their credit improves, and move onto much better deals.
What lenders want to see isn’t perfection. It’s progress.
Reframing the Past: You’re Not “Bad With Money”
Let’s pause here, because this part matters more than most people admit.
Many people who’ve had an IVA or bad credit carry deep shame about it. They label themselves as “bad with money” or “irresponsible.” Over time, that belief becomes heavier than the actual debt ever was.
But here’s the truth: most financial struggles come from circumstances, not character flaws.
Redundancy. Divorce. Illness. Supporting family. Rising living costs. A single missed payment that snowballs. One wrong decision at the wrong time.
Acknowledging what happened without letting it define you is a crucial step in becoming mortgage-ready — mentally as well as financially. Lenders don’t expect a spotless past. They expect maturity, accountability, and evidence that you’ve learned.
And that’s something you can show.
Step-by-Step: What to Do Right Now to Become Mortgage-Ready
You don’t need to wait until your credit is perfect or your savings are complete to start preparing. In fact, the earlier you begin, the more control you regain.
Here’s what you can do today.
1. Check — and clean up — your credit file
Start by pulling your credit reports from Experian, Equifax, and TransUnion. They don’t always show the same information, so check all three.
Look for:
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Incorrect balances
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Accounts marked as active when they’re closed
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Defaults that should have dropped off
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Incorrect addresses or dates
Errors happen more often than people realise, and even small inaccuracies can hurt your application.
Disputing errors isn’t about gaming the system. It’s about making sure your file reflects reality. Accuracy builds trust.
2. Get on the electoral roll
This sounds minor, but it’s huge.
Being registered to vote at your current address helps lenders verify your identity and stability. Not being on the electoral roll can raise red flags, even if everything else looks fine.
If you’ve moved recently or never registered, fix this immediately. It’s one of the simplest wins available.
3. Pay every bill on time — no exceptions
At this stage, consistency matters more than speed.
One missed payment can undo months of progress. Set up direct debits for utilities, phone bills, credit cards — anything recurring. If you struggle with memory or organisation, use reminders or budgeting apps.
Think of each on-time payment as a quiet signal to future lenders: I’m reliable now.
4. Reduce existing debt carefully
You don’t need to be debt-free, but you do need to show control.
Focus on:
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Reducing credit card balances
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Avoiding maxed-out limits
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Not taking out new credit unnecessarily
If you can, keep credit utilisation below 30%. Even small reductions can improve how your profile looks.
5. Save intentionally for a deposit
Saving after an IVA can feel slow and frustrating, especially when life is already expensive. But consistency beats size.
Set up a standing order, even if it’s modest. £50 a month matters. £100 a month matters. Over time, it adds up — and it proves discipline.
Lenders care about how you saved, not just how much.
6. Show stability in work and living arrangements
Frequent job changes or address changes can make lenders nervous. If possible, aim for at least 12 months in one role and avoid unnecessary moves.
Stability doesn’t mean being stuck — it means being predictable.
7. Avoid high-risk financial behaviour
This is critical:
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No payday loans
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No buy-now-pay-later abuse
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No gambling patterns
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No cash advances
Even if repaid, these leave a footprint that lenders dislike.
Good habits don’t just rebuild credit. They rebuild confidence.
Choosing the Right Lender — and Why You Shouldn’t Do This Alone
This is where many people go wrong: they walk into their high-street bank, get declined, and assume that’s the final answer.
It isn’t.
Most mortgages for people with IVAs or bad credit come through specialist lenders, and access to those lenders usually comes via specialist mortgage brokers.
A good broker:
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Knows which lenders suit your profile
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Avoids unnecessary credit searches
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Helps you time your application properly
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Explains what to fix before applying
Multiple rejected applications can damage your credit further. A broker protects you from that.
Be honest. Don’t downplay past issues. A broker can only help if they see the full picture.
The Emotional Side of Becoming Mortgage-Ready
This journey isn’t just financial. It’s emotional.
There will be moments when progress feels slow. When saving feels pointless. When comparison steals your joy. When you wonder if it’s even worth trying.
In those moments, remember: you’re rebuilding something solid. Not rushing into another fragile situation. Not repeating old patterns.
Homeownership after bad credit isn’t about proving anything to anyone else. It’s about stability, security, and giving yourself a fresh chapter.
Conclusion: This Is the Long Way — But It’s Still the Way Forward
Becoming mortgage-ready after an IVA or bad credit is rarely quick, and it’s almost never easy. But it is absolutely possible.
Every on-time payment.
Every pound saved.
Every smart decision.
Every month of consistency.
It all counts.
You are not behind. You are rebuilding. And one day, sooner than you think, you’ll look back and realise that the slow steps were the strongest ones you ever took.
Start where you are. Stay patient. Get the right support.
Your keys aren’t gone — they’re just waiting for you to be ready to pick them up.
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