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IVAs | IVA | Debt Advice | Help with Debt
What is an IVA - Debt Help?
| An IVA, also known as an Individual Voluntary Arrangement, is a formal Debt Solution introduced in 1986 as government legislation, which allows an Individual or a business to avoid the harshness of Bankruptcy. It enables you to pay back a portion of the total debts that you owe, based on what you can realistically afford. The rest of the debt is written off on completion of the IVA. During an IVA, both you and your creditors are bound by its terms. |  |
How does an IVA work? | How long does an IVA last for? | Advantages of an IVA
Is an IVA right for me? | Other Debt Solutions
How does an IVA work?
When you first contact someone about an IVA, the first thing they will do is run through your circumstances to see if you qualify for an IVA. This will be general stuff like, are you a homeowner/renter?, are you single/couple/family?, are you employed/unemployed? etc... They will go through your monthly income and expenditure using a set of guidelines (aside from your debts) to determine exactly how much money you are left over with at the end of each month to pay your debts.
If you still look like an eligible candidate for an IVA after this and you have enough of a disposable income to put towards an IVA, our Insolvency Practitioner (IP) will put forward your proposal to negotiate with your creditors. If the IP thinks it looks like a successful IVA, then chances are your IVA will be accepted.
**Be warned. Do not pay any upfront fees for this service up to this point. Your IVA could fail and you will lose your upfront fee. There are companies that do not charge upfront fees. Contact us at Debt Advice to find out more.
If more than 75% of your crediors vote in favour of the IVA, then your IVA is approved and your reduced monthly payments towards a percentage of the total debts that you owe will begin.
How long does an IVA last for?
An IVA usually lasts for 60 months or 5 years. After this time, your IVA is complete and the remainder of your debt is written off. for example, if you have debts of £20,000 and have a disposable income every month of £200. You enter an IVA and after 5 years you have paid £12,000 and the remaining £8,000 is written off. Your creditors can no longer pursue you for this debt.
Not all IVAs can last this long. Some IVAs can be settled in one lump sum payment. i.e. if you have equity on your home. This is known as a Lump Sum IVA.
For more information on IVAs contact our Debt Advisors on Debt Advice. You can call our lo-call Debt Helpline on 0844 56789 44 or fill in the form above.
IVA Advantages
- Complete debt freedom in 5 yrs, or quicker if it is a lump sum IVA.
- Interest and debts are frozen.
- Creditor harassment will cease. They are prohibited from demanding any further payment.
- It is a legal agreement. Your creditors can't back out once it is in place.
- You have a manageable reduced monthly payment.
- At Debt Advice, we can put you in touch with companies that don't charge upfront fees.
- Open to tenants and homeowners
Is an IVA the right choice for me?
An IVA is the right choice for you if
- You have debts over £15,000
- You have a surplus income each month (approximately £200+ after all your essential living expenses) , excluding any creditor payments (your new payment will include all your unsecured creditors)
- You have 2 or more creditors (people you owe money to).
More Debt Solutions
If an IVA sounds like something you might be interested in, you can discuss it with us at Debt Advice further, in confidence and for free.
If you feel you need more information on other Debt Solutions please see the tables below or contact Debt Advice on our lo-call helpline 0844 56789 44.
Debt Solutions (UK and N Ireland) |
Administration Order
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Debt Solutions (Scotland) |
Sequestration
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