IVA (Individual Voluntary Arrangements) Help & Advice
An IVA is a legally binding solution that allows you to combine all of your unsecured debt into one affordable monthly payment.
Any debt left over after the term of the IVA gets legally written off and removed from your credit file.
What is an IVA?
Set up and managed by an Insolvency Practitioner (IP), an IVA is a form of insolvency which allows you to write off up to 81% of unsecured debt with government legislation, and offers an alternative to bankruptcy.
In an IVA, a single monthly payment is agreed with your current financial situation taken into consideration – this payment is then divided among the people you owe money to.
What debts can be included in an IVA?
Most unsecured debts, meaning debts that are not tied to an asset such as your home, can be included in an IVA.
- Credit card debts
- Payday loans
- Personal loans
- Unpaid overdrafts
- Rent arrears
- Gas and electricity arrears
- Council tax arrears
- National insurance arrears
Certain debts can’t be included in an IVA, like unpaid court fines, unpaid child support or child maintenance, and student loans in certain cases.
Advantages & Disadvantages
Advantages
✅ Debt write off possible
✅ One affordable monthly payment
✅ Offers creditor protection
✅ Freezes interest and charges on your debts
✅ Allows you to keep your home and other assets
✅ Clear end date
Disadvantages
❌ Places you under a strict budget
❌ Doesn’t cover all debt types
❌ Will be recorded on a public register
❌ Will impact your credit rating
❌ Missed payments can cause your IVA to fail
❌ If your IVA fails, you could be made bankrupt