Why choose an Individual Voluntary Arrangement (IVA)

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An Individual Voluntary Arrangement (IVA) is a legally binding agreement set up between you and your creditors for you to repay an amount you can afford over a fixed period of time; usually around five years. It allows any unsecured debts to be written off at the end of the IVA.

Key features of an IVA:

  • If you enter into an IVA, you will have an insolvency practitioner who will act as your nominee and help you put together a proposal for your creditors. Part of this will process will involve negotiating with lenders on your behalf to agree an affordable amount to repay.
  • For an IVA to be approved, creditors representing at least 75% in value of the creditors who vote must agree to it. Once they have, it’s legally binding and they can’t pursue you, or take any further court action, as long as you keep to the terms of the agreement.
  • You will only have to pay one amount each month and that will include fees for setting up and managing your IVA. You won’t have to pay extra for these fees – you simply pay the agreed amount you can afford each month and these costs will be deducted from the sum you pay every month.
  • IVAs usually last for 5 years (60 months). However, if you’re a homeowner, you may be asked to release some equity to pay into your IVA. If you’re unable to do this, you’ll need to make a further 12 months’ worth of payments into your IVA, meaning it’s complete after 6 years.

An IVA is only available if you live in England, Northern Ireland or Wales. If you live in Scotland, you can apply for a Trust Deed.