IVA – Significant equity in your home

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.

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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 retired clients were able to avoid bankruptcy and the potential loss of their home, and then repay only a proportion of their unsecured debts after we set up an IVA for them.

IVA case study – having significant equity in your home

We helped a retired couple who owed over £30,000 on unsecured loans and credit cards. They owned their own home, with £40,000 equity.

They had lived in their home for over thirty years so were particularly anxious to avoid their home being sold, which would probably be the case in bankruptcy. The husband was also disabled and the property had been specifically adapted for his needs. After their living costs were taken into account, they could afford to make a monthly payment of £300 towards their debts.   

Even though it appears they could sell their property and pay off their debts in full, they would be unlikely to find another property that had been specifically adapted to suit their needs.

We set up an IVA over five years, and explained to their unsecured creditors that the increased costs in bankruptcy of the property being sold against the client’s will, actually meant that creditors will receive a higher dividend in an IVA.

Creditors agreed to the IVA, which wrote off around £100,000 of their unsecured debt and reduced their monthly debt payments by more than £600.

An IVA may help you if you have a significant amount of equity in your home

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.