If you have a significant amount of unsecured debt that you can’t afford to repay, you may have been advised to enter an IVA (Individual Voluntary Arrangement) in order to repay your debts at a realistic rate.
Like most debt solutions, though, an IVA will have an impact on your credit rating – which will be affected for six years. As a result, applying for a bank account could be difficult, as some banks may consider you to be a ‘risk’ due to your financial problems in the past.
However, if you’re currently involved in a debt solution there are some alternative banking options which may be open to you instead. Here we’ll look at opening an account if you’re struggling with debt.
“I’m on an IVA. Could I open a bank account?”
As an approach to dealing with unmanageable debts, an IVA – a form of insolvency – could offer some real advantages, but like any debt solution, it comes with some downsides too. By damaging your credit rating, entering an IVA could make it difficult to find a bank account.
However, opening an account whilst in debt is possible – in fact, some bank account providers offer ‘IVA bank accounts’ designed to help people in that situation. They could do this in two important ways.