Can a company borrow if the director is in an IVA?
This is a nuanced area. The key distinction is that the borrower is the limited company or LLP — not the individual director. The IVA is a personal insolvency arrangement between the director and their creditors. It governs the director's personal finances, not the company's.
However, because most bridging lenders require a personal guarantee from directors, and because the director's IVA is serious adverse credit, the IVA does affect the application. The question is not "can the company borrow" — it is "which lenders will consider a company where the director is in an IVA, and on what terms."
The key considerations
IVA supervisor consent
An individual in an active IVA is generally restricted from taking on new credit above £500 without their supervisor's consent. Taking on a personal guarantee without this consent could constitute a breach of the IVA. Always seek independent legal advice and discuss with your IVA supervisor before proceeding.
Company vs personal borrowing
The company is the legal borrower on a bridging loan, not the director personally. The director's IVA governs personal finances — the company's borrowing capacity is separate, subject to the company's own financial position and the lender's criteria.
Property security strength
With an IVA in the background, lenders will require stronger property security — typically lower LTV and a very clear exit strategy. The quality of the security and the credibility of the exit carry significant weight.
Active vs discharged
An active IVA (still in the payment plan) is more restrictive than a recently discharged IVA. Options improve materially once the IVA is completed and the discharge certificate issued. Both situations can be assisted, but the process differs.
Active IVA — what is possible?
With an active IVA, the practical constraints are significant. Personal guarantees require IVA supervisor consent; lenders will apply lower LTV limits and higher scrutiny. However, some specialist bridging lenders on our panel will consider limited company applications where the director is in an active IVA, provided the LTV is conservative, the exit is well-evidenced, and the IVA supervisor has been engaged.
You must inform your IVA supervisor of any proposed company borrowing you will be providing a personal guarantee for. Failure to do so may constitute a breach of the IVA. We strongly recommend taking independent legal advice before proceeding.
Recently discharged IVA — what is possible?
Once the IVA is discharged (the payment plan is complete), options improve significantly. The IVA will remain on the director's credit file for six years from the start date, but the practical restriction on taking on new credit is removed. Specialist bridging lenders regularly assist limited companies with recently discharged directors — the focus shifts to the property security, the exit strategy, and the trajectory of the director's financial position post-discharge.
What property is accepted as security?
UK investment and commercial property: buy-to-let residential properties, HMOs, commercial units, mixed-use buildings, and development sites. The security must be held by the limited company or as an investment property — not the director's main residence (which would create a regulated mortgage).