IVA – Extinguishing joint liability

An Individual Voluntary Arrangement (IVA) is normally a five year agreement with your unsecured creditors that helps you avoid bankruptcy. You get protection from those creditors and you only pay back a proportion of your unsecured debts and write the rest off.

If you’re worried about your debts, PayPlan can help you. You can call us now on 0800 280 2816 or, if you’d prefer, click the “Get advice now” button to request a call back.

Get advice now


PayPlan help all kinds of people in debt

Over the last twenty years, PayPlan have helped millions of people who were having difficulty in paying their debts.

Everyone’s circumstances are unique, and our experienced advisers will be able to suggest next steps for you no matter what your financial situation.

This page outlines a very specific case study: where a client was able to enter into an IVA where an element of joint liability was extinguished. He was able to ultimately avoid bankruptcy and repay only a proportion of his unsecured debts after we set up an IVA for him.

IVA case study – extinguishing joint liability

We helped a civil servant who owed £40,000 mainly on loans. He lived with his wife and two children.   His wife did not have any debt in her sole name, but had one joint loan for £15,000. After their living costs were taken into account, they could afford to make a monthly payment of £240 towards their debts.   

We discussed all the debt solutions with them, and they decided to set up an IVA.   However, as the wife only owed one debt, instead of setting up an IVA for the husband and an IVA for his wife, we wrote a clause in his IVA that his wife was no longer responsible for the joint debt if her husband’s IVA was successfully completed. The loan company agreed to accept this clause, and the IVA was successfully completed in five years.

Creditors agreed to write off over £25,000 of their unsecured debt and reduced their monthly debt payments by more than £800.

An IVA may help you if you have joint liability for debts

Are you serious about getting out of debt?

Successfully completing an IVA means avoiding bankruptcy and not having to deal with any more unsecured creditor demands for payment. You’ll normally make just one affordable payment for a set period of time, and creditors included in the IVA must freeze interest and charges at the point your IVA is agreed.

Become a PayPlan IVA client and you get:

  • A personal debt adviser to handle your IVA case
  • Just one regular payment to make, based on what you can afford to pay
  • All the support of a company who have, over the last twenty years, helped tens of thousands of people achieve debt-free status through an IVA
  • After the agreed IVA period, whatever unsecured debt remains is written off

And remember, at PayPlan, we do not charge any upfront fees for setting up an IVA.

However you must bear in mind that if you were, for whatever reason, to stop making payments to your IVA then your plan may fail; in which case your creditors may re-apply interest and charges (which were frozen at the point your IVA was approved) or may even petition for your bankruptcy. Read more about the pros and cons of bankruptcy

Want to avoid bankruptcy? Think an IVA could help you manage your debts more affordably? Many people choose to call us on 0800 280 2816 for free no-obligation debt advice, while others prefer to fill in our online Debt Help form so we can call them back.