"A IVA" and "IVA a" - are popular searches for those wanting to solve a debt problem

"a IVA" and "IVA a" have become amongst the most popular searches on this site and are an indication of how much confusion there is around IVAs or Individual Voluntary Arrangements. If you find yourself in serious debt you could use an IVA to regain control of your debts.

 

An IVA is an official legally binding solution that makes the debt that you are currently struggling with or failing to repay, manageable. But before you can get one, an Insolvency Practitioner through IVA companies will need to take a detailed look at what you owe and how much you can afford to repay. They will then propose a new lower monthly repayment to your creditors that is set at a level that is fair and manageable. This normally involves a write off of a significant part of your debt and repaying the balance over 60 months or 5 years.

Summary

Individual Voluntary Arrangement IVA

  • Introduced by the Government in 1986 as an alternative to bankruptcy
  • Typically you owe more than £15,000 and have something to offer your creditors each month
  • Typically you can write-off 50% - 60% of your debt and pay the balance over 5 years (60 months)
  • Interest and charges stop and creditors can't change their mind
  • Your home is protected but you may be required to release any equity you have
  • Someone enters an IVA in England and Wales every 13 minutes
  • We only recommend organisations that have a track record of getting IVAs accepted by creditors and don't charge upfront fees

Comparison Table Of Debt Solutions

Solutions
Debts Written Off
Legally Binding
Interests & Charges
Residential Status
Fees
Notes
IVA
Yes - on average 58% of the value
Yes
Stopped
Tenant or homeowner (Eng/Wales)
Yes - on average around 20% of the payments you make to creditors
Typically you must have debts over £15,000 and be able to offer your creditors about 20% of the value of the debt back over 5 years.
Debt Management
No
No
Many are frozen
Tenant or homeowner
Yes
In a Debt Management Plan you will be required to repay all of your debt in full.
Consolidation
No
Yes
New rates and charges
Tenant or homeowner
Yes
Consolidating your debts generally means you'll pay more back over a longer period of time.
Bankruptcy
Yes
Yes
Stopped
Tenant or homeowner (Eng/Wales)
Yes - up to £700 depending on your circumstances. You may also be subject to 3 year income payments
You need to think carefully about the affect bankruptcy will have on your home and job.
Debt Relief Order
Yes
Yes
Stopped
Tenant
Yes - £90
You typically have debts under £15,000 and have little in the way of assets