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A IVA

“A IVA” and “IVA a” – are popular searches for those wanting to solve a debt problem

Applying for an IVA

“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 need to owe more than £15,000 and have something to offer to 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 IVA’s 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 – Average 58% 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 yourcreditors about 20% of the value of the debt back over 5 years.
Debt Management No No Many Freeze 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 & 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 a 3 year Income Payments You need to think carefully about all the affect bankruptcy will have on your home and your employment.
Debt Relief Order yes yes Stopped Tenant Yes – £90 You must have debts under £15,000 and have little in the way of assets

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