What happens to your home and belongings in an IVA?

The rules for homeowners changed on 1 July 2025, and most of what you will find online still describes the old system. Which rules apply to you depends on when your IVA was approved, and on whether it is a protocol IVA (the standard type for consumers) or a bespoke one. Your other belongings are treated in much the same way under both: everyday essentials are safe, savings usually are not, and a valuable car may be looked at.

Will you have to sell your home in an IVA?

No, not in a protocol IVA agreed on or after 1 July 2025. The IVA Protocol 2025 says a protocol IVA “will not include any proposal requiring the consumer to realise their interest in a family home”. The key facts document you must be given before signing puts it plainly: “You will not need to sell or use any equity in your home to pay for your IVA.” You can read both on the IVA Protocol page on GOV.UK.

The trade-off is time. If your share of the equity is £10,000 or more, the IVA runs for 72 months instead of 60, “in lieu of” your equity. Your home is still excluded.

There are limits to this. If your home has very high equity, or you own more than one property or a buy-to-let, the Protocol says a protocol IVA is unlikely to be appropriate and a bespoke IVA should be considered alongside other options. A bespoke IVA can have different terms, including about your home, so read that part of any proposal carefully.

You keep paying your mortgage as normal. It is not part of the IVA. See mortgages and IVAs.

How is your equity worked out?

1. You value your home, for example using an online valuation tool, and the insolvency practitioner checks it. If you get a range, the middle of the range is used.
2. Take 85% of that value.
3. Subtract the mortgage and any other borrowing secured on the home.
4. Your share of what is left is your beneficial interest. If you own the home jointly, only your share counts, and joint owners often, but not always, have half each.

If your beneficial interest is under £10,000, the IVA is proposed for 60 months. If it is £10,000 or more, it is proposed for 72 months. Either way the home is excluded, and there is no further equity review once the IVA is in force.

These three examples are hypothetical.

Home 3 shows why the 85% step matters. The house is worth £20,000 more than the mortgage, but once you take 85% of the value there is no equity left for the calculation, so the IVA is 60 months.

What if your IVA started before 1 July 2025?

Your IVA keeps the terms it was agreed on. The 2025 rules do not replace them. Many IVAs from 2021 to June 2025 used the IVA Protocol 2021, which worked like this:

• Equity was also worked out as 85% of the value minus the mortgage.
• If it was below £5,000 (the “de minimis” figure), the IVA ran for 60 months.
• Above £5,000, the IVA was set up for 72 months. Where a remortgage looked possible, the home was revalued around month 54 and you were expected to try to remortgage, borrowing no more than 85% of the value, with the money going to creditors.
• If a remortgage could not be obtained, the IVA stayed at 72 months.

If you have an older IVA, read the home section of your proposal and ask your supervisor what applies to you, especially if month 54 is coming up. Advice you find online about “remortgaging in year 5” only applies to IVAs like these. It has never applied to people who do not own a home.

Can you sell or move home during an IVA?

You can, but talk to your supervisor first. The standard terms require you to keep your supervisor informed of your address. A new mortgage is credit, so it needs their written approval if it is over £500, which it will be.

Can you keep your car?

Usually, yes. Anything that would be protected in bankruptcy is excluded from a protocol IVA. That includes vehicles and equipment “necessary” for you to use personally in your job or business.

Value still matters. StepChange says you can usually keep your car depending on its value, and that you may need to sell it if it is particularly valuable or you own more than one. The Protocol sets no figure for this, so ask the insolvency practitioner how your car will be treated before you sign.

If your car is on hire purchase or PCP, the finance company owns it until the agreement ends. The monthly finance payment can be allowed for in your budget if you reasonably need the car. See IVAs and car finance.

What happens to your pension, savings and possessions?

Pensions

Reasonable pension contributions taken from your pay, or paid to a private scheme, can continue. Additional voluntary contributions cannot. If your scheme does not set a minimum, the auto-enrolment rate can be used as a guide to what is reasonable.

Nothing in the Protocol’s standard terms requires you to draw or cash in a pension. Citizens Advice says that if you have not started taking money from your pension pot, “your creditors probably won’t expect you to access it”. Pension income you already receive counts as income in your budget. If you will reach pension age during the IVA, or are thinking of taking money out, ask your supervisor first.

Savings and investments

Citizens Advice says savings usually have to be included, either as a lump sum to creditors or to fund your payments. The small emergency amount in your budget is separate. If you hold shares, bonds or invested savings, the Protocol says a protocol IVA is unlikely to be suitable.

Possessions

Clothing, bedding, furniture, household equipment and food needed for the basic domestic needs of you and your family are excluded, as they are in bankruptcy. Valuable items you do not need for everyday life may be included.

Money you receive later

Any asset, windfall or inheritance worth more than £500 that you receive during the IVA can be claimed for creditors, but only as much as is needed to repay them in full plus costs. See inheritance in an IVA.

You must list everything you own when the proposal is prepared. Giving false information to get creditors to approve an IVA is a criminal offence, even if the IVA is not approved.

What happens to your bank account?

If you owe money to the bank you use, or to a company connected to it, the bank can take money from your account to pay that debt. This is called the right of set-off. Citizens Advice suggests getting your income paid into an account with a different bank before the IVA starts, and says your insolvency practitioner should help with this.

A basic bank account works like a normal current account but has no overdraft, and banks cannot use your credit rating as a reason to refuse you one.

The standard terms also say that if a creditor in your IVA has to pay you money during the IVA, such as a refund, it is used first to reduce what you owe that creditor.

What to do next

1. Work out your equity using the 85% method: a mid-point online valuation, your latest mortgage statement and your share of ownership.
2. List every asset, including your car, savings, pensions and anything valuable, and ask the practitioner in writing how each will be treated.
3. If you owe money to your own bank, set up an account elsewhere before any IVA starts.
4. Compare the alternatives. In bankruptcy, a trustee can sell your home if your equity is more than £1,000, which is very different: see IVA or bankruptcy?. Free, impartial debt advice is available from MoneyHelper, StepChange, Citizens Advice and National Debtline: see where to get free debt advice.

For more on day-to-day life in an IVA, see life in an IVA. If you use our checker, we may pass your details to a licensed insolvency practitioner or debt adviser.