Myths about IVAs

If you’ve never heard of an Individual Voluntary Arrangement (IVA) before, it can sound a bit intimidating. And if you’ve done some digging, you might have come across a few common misconceptions.

We’re here to clear those up – so you can make informed choices with confidence.

Myth: An IVA is right for everyone

Not true – an IVA can be a great solution for many people, but it’s not the only option. Our debt advisors will look at your full financial picture and help you explore all available solutions – including those outside of an IVA – to find what’s best for you.

Myth: I’ll lose my home

No – your home is protected. If you own properly, your IVA might be extended by up to 12 months instead of requiring you to remortgage or sell. Your Insolvency Practitioner (IP) will explain how equity is treated and make sure everything is clear from the start.

Myth: I will have to pay expensive fees in an IVA

There are no upfront or extra fees. All IVA-related costs (like legal, management and admin fees) are built into your monthly payment and only charged if your IVA is approved. You’ll never pay more than you can afford. Click here to know more about the fees in an IVA.

Myth: People will find out about my financial situation

Your IVA will appear on the Insolvency Register and your credit file, but these aren’t as public as people think. The register is online and your credit file is private (only lenders and authorised parties can access it) and most employers don’t need to know unless your job involves financial checks.

Myth: I can’t change my IVA once it’s agreed

Your IVA is designed to adapt to your situation. If your income drops, you might be able to reduce payments. If your circumstances improve, your IP will help you adjust fairly. They’re there to support and guide you throughout.

Myth: One missed payment means my IVA will fail

Missing a payment doesn’t mean your IVA ends. Talk to your IP as soon as possible. They may be able to adjust your plan, pause payments temporarily or work out a new arrangement. If you ignore the issue and miss several payments, then yes, your IVA could be at risk.

Myth: I won’t be able to save

Your IVA budget is built around essential living costs and includes a little breathing room. You might not be able to save much each month, but small savings are encouraged to help cover emergencies.

Myth: My partner will be affected

Your IVA is personal to you. Your partner won’t be responsible for your debts or asked to contribute. Creditors will want to check that household costs are shared fairly – but that’s all. Your partner’s income and assets remain separate.

Myth: I can’t get an IVA if I’m on benefits

It depends on your overall situation. If you receive benefits and no other income, another debt solution may be more suitable. But if benefits are part of a wider budget – for example, alongside wages or a partner’s contribution – you may still qualify. A debt advisor will review everything and guide you toward the right solution.

Get confidential debt advice

We offer impartial support and expert advice to help you take control of your finances. Call us free on 0800 316 1833 or chat with us via WhatsApp or Live Chat on payplan.com.