If you own your home and you're struggling with debt, the biggest worry is often what will happen to the house. The good news is that an IVA is one of the formal debt solutions that can work for homeowners, and the rules became clearer in 2025.
Under the current IVA Protocol, which applies to new protocol IVAs from 1 July 2025, your family home doesn't form part of the IVA. You won't be asked to sell it or to remortgage. Instead, the amount of equity you have decides whether your IVA runs for five years or six.
The short answer
- Homeowners can get an IVA, and it's designed to let you keep your home.
- Under the 2025 IVA Protocol, your home isn't included and you won't be asked to remortgage.
- If your share of the equity is under £10,000, the IVA usually lasts five years.
- If it's £10,000 or more, it usually lasts six years.
- You keep paying your mortgage as normal. It stays outside the IVA.
- IVAs set up before the 2025 Protocol may still include a year-5 equity release clause.
How the 2025 IVA Protocol treats your home
The IVA Protocol is the standard set of terms used for most consumer IVAs in England and Wales. The Insolvency Service published a new version in 2025, and from 1 July 2025 all new protocol IVAs must follow it. One of the biggest changes was for homeowners.
Under the old rules, many homeowners were asked to remortgage towards the end of their IVA to release equity for creditors, or pay for an extra year if they couldn't. That step has gone. Now your equity is assessed at the start, and it simply sets the length of your IVA. You can read the official summary in GOV.UK’s IVA key facts.
How equity is worked out
Your insolvency practitioner works out your equity using a standard calculation:
- Take 85% of your property's current market value.
- Subtract your outstanding mortgage and any other secured loans.
- If you own the property with someone else, work out your share of what's left.
Using 85% of the value, rather than the full value, allows for selling costs and changes in the market. Here's how it works in practice:
| Example | Sole owner | Joint owner (50/50) |
|---|---|---|
| Property value | £200,000 | £200,000 |
| 85% of value | £170,000 | £170,000 |
| Less mortgage and secured loans | £155,000 | £155,000 |
| Equity | £15,000 | £15,000 |
| Your share | £15,000 | £7,500 |
| Usual IVA length | 6 years | 5 years |
Illustration only. Your insolvency practitioner will confirm the valuation and calculation for your own property.
Your mortgage stays separate
An IVA only deals with unsecured debts such as credit cards, loans, overdrafts and council tax arrears. Your mortgage and any loans secured on your home stay outside the IVA, so you keep paying them as normal. When your IVA budget is put together, your mortgage payment is treated as an essential cost, alongside things like council tax, energy and food, before your monthly IVA payment is worked out. If you have mortgage arrears, tell your adviser, as these need dealing with separately.
Check which debt solutions you could qualify for. It won’t affect your credit score.
If you're already in an IVA
The 2025 Protocol applies to new protocol IVAs. If your IVA started before then, it's likely to follow an earlier version, which often includes a clause asking you to try to release equity towards the end of the term. Your own IVA terms decide what applies to you. Our guide to equity release in year 5 explains how the older rules work, and your insolvency practitioner can confirm your position.
Some IVAs don't follow the Protocol at all and use terms set out individually. If you're offered a non-standard IVA because of the equity in your home, it's worth getting a second opinion from a free advice service such as StepChange before agreeing.
Is an IVA the right choice for a homeowner?
For many homeowners, the main advantage of an IVA over bankruptcy is that it's designed to let you keep your home. In bankruptcy, your share of the equity can be used to repay creditors, which may mean selling the property. A debt relief order generally isn't available to homeowners at all.
An IVA isn't right for everyone, though. It's a formal insolvency procedure that lasts five or six years, affects your credit file for six years, and has fees taken from your payments. If you can afford to repay your debts in full over time, a debt management plan may be worth comparing. Read will I lose my house in an IVA? for the situations where your home could still be at risk.
Common questions
Can I get an IVA if I own my home?
Yes. An IVA is one of the formal debt solutions that can work for homeowners. Under the 2025 IVA Protocol, which applies to new protocol IVAs from 1 July 2025, your family home doesn't form part of the IVA and you won't be asked to sell it or remortgage.
Do I have to remortgage in an IVA?
Not under the current IVA Protocol. Instead of a remortgage, the amount of equity you have decides how long your IVA lasts. IVAs set up before the 2025 Protocol may include a clause asking you to try to remortgage towards the end, so check your own terms if you're already in one.
How much equity can I have in an IVA?
There's no upper limit. Under the 2025 Protocol, if your share of the equity is under £10,000 your IVA usually lasts five years, and if it's £10,000 or more it usually lasts six years. Equity is worked out as 85% of your home's value, minus your mortgage and any secured loans.
Do I keep paying my mortgage during an IVA?
Yes. Your mortgage and any secured loans stay outside the IVA, so you keep paying them as normal. Your mortgage payment is included in your budget as an essential cost before your IVA payment is worked out.
What if I own my home jointly?
Only your share of the equity is counted. If you own your home 50/50 with a partner, for example, half of the equity is treated as yours. Your partner isn't included in your IVA unless they have one of their own.
Can I sell my home during an IVA?
You aren't usually required to sell, and selling is your choice. If you do sell, you'll need to tell your insolvency practitioner first, as the money from the sale may need to be dealt with under your IVA terms.
How IVA Advice Online can help
We'll look at your home, your mortgage and your other debts with you, explain how the current rules would apply, and set out the debt solutions you could qualify for. To talk through your options, get in touch.