Individual Voluntary Arrangement (IVA) (not available in Scotland)

What Is It?

An IVA is a formal arrangement with your creditors. It's entered into with the assistance of an Insolvency Practitioner, who will work to secure the agreement of your creditors to a payment proposal.

Do I Qualify?

You qualify for an IVA if you are:

• Typically carrying consumer debts of £15,000 or more
• You are struggling to meet current repayments to your creditors
• You may be able to pay a certain reduced amount per month towards your debt, or you may be able to release a lump sum through remortgaging your home or sale of another asset.

If you are resident in Scotland you may be eligible for a Trust Deed.

Advantages

• Takes the pressure off
• One affordable payment per month to your creditors
• Fixed repayment period (normally 60 months or less)
• Any remaining debt could be written of at the end of the fixed period
• Creditors freeze future interest and charges
• Less stigma and publicity than normally caused by bankruptcy
• You are involved in the choice of assets made available to creditors

Disadvantages

• Usually only suitable if you have £15,000 of unsecured debt or more
• During the IVA active period you will be unable to borrow further funds without the permission of the arrangements supervisor
• The IVA may appear on your credit file and affect your future credit rating
• Should the IVA fail, you may still be made bankrupt
• 75%, in value, of your creditors who vote (on the proposal) must agree to your proposed arrangement