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Individual Voluntary Arrangement (IVA) Debt Solution

What is an IVA?

An Individual Voluntary Arrangement (IVA) is an agreement with your creditors that helps you avoid bankruptcy, pay off only a proportion of your unsecured debts, and stops creditor demands for money. Normally lasting for 5 or 6 years, an IVA will enable you to pay some of your debt back, after which time all remaining debt is written off.

Read about what is an IVA in detail

Eligibility for an IVA

  • You will have over £10,000 of unsecured debt
  • Your assets (equity in a house, car) will not be enough for you to clear all debt through selling the asset
  • You will have some available income (certainly over £100/mth) available to pay into the IVA
  • You will live in England, Wales or N Ireland (residents in Scotland will need to consider a Trust Deed instead)

Results of a successful IVA

  • Avoided bankruptcy and its penalties
  • Made debt repayments that are affordable
  • Had interest and charges frozen
  • Had no hassle from creditors requesting payments
  • Had a proportion of your debts written off

Please note that all these benefits naturally depend on you keeping to and completing the affordable repayment terms of your IVA. If you stop making payments into your IVA then your creditors may then petition for your bankruptcy and re-apply interest and charges.

Disadvantages of an IVA

  • For the length of the IVA, you will be expected to live on a budget that is approved by the creditors through an Insolvency Practitioner. Whilst all reasonable household and personal expenses are allowed, there is little room for luxuries.
  • Increased income (e.g. overtime, bonuses, pay rises) will be borne in mind and repayment levels recalculated. Any lump sum received will also be expected to be made available to the IVA.
  • The IVA will be visible on your credit file, so obtaining further credit during an IVA is not normally an option.

What next?

It would be advisable if you feel that an IVA may be an appropriate solution for you, to discuss the possibility with a licensed Insolvency Practitioner or with a debt advisor.

The above is provided as information only. Iva.co.uk does not provide debt advice. You must always seek professional advice before taking any action to resolve your debts.

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Important Information

IVA.co.uk does not provide debt advice. You must always seek professional advice before taking any action to resolve your debts. If you use the IVA Calculator or call the IVA Helpline, we will pass on your details or connect you to one of our partners who will contact you and explain all the options available to you. With your permission they can connect you with authorised debt solution providers who can process an application for you

IVA.co.uk does not charge you any fees for use of our forum or the IVA Calculator, however we do get paid by our sponsors and the partners we work with. Our partners charge fees and those vary depending on the partner and the debt solution. Customers should refer to our partners' websites for more information regarding their services.

Before entering into any debt solution you should ensure that you have considered the implications. Failure to keep up with repayments can result in bankruptcy or legal action. Lenders are not obliged to accept less in settlement of a debt than they are entitled to or to freeze interest or charges. Not all solutions involve debt write off and some solutions may result in the total amount payable increasing, or the period over which it is to be repaid increasing. Debt solutions will affect your credit rating which records all financial activity for 6 years. Your assets and property could be at risk in some solutions. Conditions apply and each application will be subject to acceptance and eligibility.

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