Individual Voluntary Arrangement (IVA)

An Individual Voluntary Arrangement (IVA) could be your perfect debt free solution.

If you are have serious debt problems, are unable to keep up minimum repayments and owe more than £15,000 of unsecured debt, then an IVA means you can avoid bankruptcy. 

An IVA is a legally binding contract, unlike a informal debt management agreement. Although this may first sound concerning, there are real benefits for you. An IVA is legally binding on your creditors, so if you maintain monthly payments then your creditors cannot take any legal action against you. You protect your assets, no interest and charges are added, you pay only what you can afford monthly and what you haven’t repaid on completing your IVA is written off.

This may sound too good to be true, but, if you qualify, you have a legal right to an IVA proposal, which is subject to the agreement of your creditors. An IVA is government legislation launched a less severe alternative to bankruptcy, to help those struggling with their debts. 

Your IVA proposal can only be arranged by a licensed Insolvency Practitioner, who will put forward your proposal to your creditors. Your creditors will often accept an IVA repaying only 40% or less of your debt, as it means they can avoid expensive collection or bankruptcy costs. Additionally they are eligible for tax and VAT relief on any debt that remains unpaid once you have completed your IVA.

However, as an IVA is legally binding, this means that you should not enter into an IVA if you cannot afford the monthly repayment. Your Insolvency Practitioner will help to agree what you can afford to repay each month and you must commit to paying that amount each month.

An IVA is usually a 60 month repayment agreement between you and your creditors and, at the end of the IVA, what you haven’t repaid is written off.


IVA Benefits:

• Write off a substantial proportion of your debt.
• One low affordable monthly payment.
• All interest and charges stopped.
• No more worry about creditor calls or letters.
• No other solution, except bankruptcy, can write off part of your debt.

If you want to hear more about whether an IVA is suitable for you, call our IVA trained advisors on 0808 131 9100, or fill in the Debt Wizard to see what other debt solutions are available.

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.)