Am I suitable for an IVA?
If you qualify for an IVA, it is often your best debt solution, as other options such as debt management plans or consolidation loans, will often increase your debt amount and the duration of your repayments.
Your IVA eligibility cannot be simply determined by a few brief questions. You will need to speak to a qualified expert who will conduct a detailed financial Factfind.
However, there are some basic criteria to see if you are likely to be accepted for an IVA.
- Do you have unsecured debts of over £15,000?
Unsecured debts such as:
- Personal Loans.
- Credit and Store Cards.
- Catalogue Debts.
- Overdrafts.
You may not think that you have £15,000 of unsecured debt, as you may have only borrowed £10,000, but if you have not been making your full monthly repayments, then interest and charges have added to your debt, which could well have grown to over £15,000. It is important that you obtain an up-to-date outstanding balance from your creditors.
- Are you insolvent?
Insolvency is not the same as bankruptcy. It simply describes your ability to repay your debt. Prior to IVAs the only solution for insolvency was bankruptcy, but now if it is determined that you are insolvent, then an IVA could be your best option.
Do not fall into the trap of just repaying the minimum monthly payment and thinking you can afford your debts, because with the interest and charges applied you could be paying for the rest of your life! Research published by the Sunday Times suggests that paying the minimum monthy payments will take over 40 years to clear your debts!
- Do you have a stable income?
An IVA is a debt repayment plan and to ensure that you can make the agreed repayments you must have an income.
You would need to commit to paying a fixed but affordable amount to your creditors each month. To agree to this commitment you must therefore be employed with stable income.
- Are you resident in England, Wales or Northern Ireland?
IVAs are only available by law in England, Wales & Northern Ireland. If you are a Scottish Resident then please see our Trust Deeds section, as this is the Scottish equivalent to an IVA.
These simple criteria represent a mere generalisation and we would need to speak to you to determine whether you are IVA eligible. Call one of our expert advisors on 0808 131 9100 or complete the Debt Wizard.
Entering into an IVA may adversely affect your
credit rating for up to six years from the date of approval.
Your property will be protected within an
IVA but you may be required to release all or part of any equity during the
period of the arrangement.
Failure to complete the term of an IVA can
result in bankruptcy.
(In Scotland, a PTD is the equivalent to an IVA.)