The IVA Process

An Individual Voluntary Arrangement (IVA) is a legally binding way to deal with unaffordable debt. It’s designed to protect both you and your creditors – but because it’s a formal solution, there’s a clear process to follow.

Step 1: Get free debt advice

Even if you think an IVA might be the right choice, it’s important to speak to an expert first. Every debt solution has its pros and cons – and another option may suit your situation better.

One of our trained advisors will review your income, spending and debt level to help you explore all your options. If an IVA is the best fit, we’ll help you take the next step.

Step 2: Work with an Insolvency Practitioner (IP)

If you choose to go ahead, you’ll be referred to a qualified Insolvency Practitioner (IP) – a professional licensed to set up and manage IVAs.

Your IP will:

• Review your finances
• Help you create a realistic, sustainable budget
• Explain how an IVA may affect your home or assets
• Answer your questions and keep you fully informed

At PayPlan, we refer clients to PayPlan Partnership Limited or PayPlan Bespoke Solutions Limited, depending on your individual circumstances. Both are fully authorised and experienced.

Step 3: Creating your IVA proposal

Building your monthly budget

Your monthly IVA payment will be based on what you can afford after covering essential living costs like:

• Rent or mortgage
• Bills
• Food and toiletries
• Travel
• Childcare
• Clothing

You won’t be expected to go without the basics. The goal is to help you repay your debts while still living comfortably.

Your budget will be reviewed each year. If your income increases, you may be asked to increase your payment.

Gathering your information

To prepare your IVA proposal, you’ll need to provide:

• Recent bank statements and payslips (three months)
• Mortgage or rent statements
• Details of secured loans or car finance
• Letters from creditors
• Information about insurance or pension contributions

Being open and honest is essential. Missing or incorrect information can delay or even stop your IVA from being approved. Once ready, your IP will send the proposal to your creditors.

Step 4: The Creditors’ Meeting

Your creditors will vote on your IVA proposal. For it to be approved, 75% (by value) of the creditors who vote must agree.

They’ll consider:

• How much you owe
• What you’re offering to repay
• Your income and assets
• The reasons behind your debts
• Your commitment to the arrangement

They may ask for small changes, such as reducing non-essential spending – but you won’t be asked to give up everything. The goal is fairness and sustainability.

Step 5: Make your monthly payments

Your IVA payments will reflect your income and household needs. If creditors ask for changes, you can:

• Accept the revised terms
• Try to negotiate
• Decline – but this means your IVA won’t proceed

Your plan will be reviewed each year. If your income goes up, you’ll usually be asked to pay 50% of the extra into your IVA.

If you experience financial difficulties later, your IP can ask creditors to agree to reduce your payment. If accepted, your IVA will continue under new terms.

If you stop paying without an agreed change, your IVA may fail and creditors can begin chasing you again for the full balance.

Need help or want to talk?

We offer confidential and impartial debt advice. Our advisors are here to guide you with empathy and clarity. Fill in a form to contact us via Live Chat or WhatsApp, or call us on 0800 316 1833.