An Individual Voluntary Arrangement (IVA) is a formal debt solution which you can consolidate all of your debts and pay one low affordable monthly payment to an Insolvency Practitioner (IP).
Want to know the best parts?
- You get to stay in your house.
- You get to keep your car.
- Stop all interest and charges instantly.
- You don’t have to deal with your creditors. Your IP will distribute this monthly contribution according to the amounts agreed by the creditors that you owe money to. Your IVA debt will be reduced as you make payments into your plan.
- You will be debt free after 5 years. You make your payment every month for 60 months (5 years) and at the end of the term all of your debt balances are written off completely.
- Whilst you are in your IVA, your creditors will not be allowed to contact you or take any further action against you.
If you are looking for IVA advice which will stop bankruptcy in its tracks and put you on the road to financial recovery, then look no further than an IVA.
An IVA only works if you set it up before your creditors seize assets, so don’t delay.
Do I qualify?
- Do you have £5000 or more in debt?
- Do you have 2 or more creditors?
- Do you have a regular income?
- Are willing to pay £90 or more towards your unsecured debts?
Top Tip – If you are Scottish – you will need to apply for a Scottish Trust Deed (Scottish IVA).
What debts can go into an IVA?
Here’s the deal:
Generally speaking, unsecured debts can go into an IVA. The most common debts which are put into an IVA are:
- Credit cards such as HSBC, Natwest, Barclaycard, Vanquis, Asda, Virgin, Capital One.
- Payday loans such as Lending Stream, Wonga, QuickQuid, Drafty, Cashfloat, Satsuma. Apply Now.
- Overdraft debts with your current bank account or your previous bank account.
- Unsecured loans.
- HMRC debts.
- Council tax debts.
Top Tip – When you apply for an IVA all of your unsecured debts must be included, you can not pick and choose what you include!
What debts can not go into an IVA?
- Mortgage arrears.
- Rent arrears – unless your landlord agrees to the IVA proposal.
- Secured loan debt.
- Guarantor loan debts.
- Hire purchase debt.
An IVA can be particularly beneficial to professionals such as accountants or solicitors, who would not be able to continue working when under bankruptcy. IVA’s act as a final way to complete repayments to creditors as part of a debt management plan. When you apply for an IVA it is often beneficial to your creditors, particularly if you have received a statutory demand or bankruptcy petition, so in many cases the proposal made is agreed.
How to apply
- Consider your options and decide whether you should apply for an IVA.
- Use our free IVA Calculator by clicking the “Apply Now” button below, this will run you through the basic qualifying criteria and let you know if you are eligible for an IVA.
- If you are eligible, one of our friendly advisors will review your debts and provide you with free IVA advice and ensure that this is the best option for yourself before working with you to create a proposal.
- There are no up front costs, just pay one low monthly payment towards your debt to a licensed insolvency practitioner. At the end of the 60 months, the remainder of your debt will be written off in full and your IVA will end.
A legislated debt solution could give you your life back and pave the way to a happier debt-free future for you and your family. Your solution will allow you to get your life back on track through sensible financial management. You will be able to not worry about your creditors heavy handed approach towards debtors.
Could I apply for an IVA online today?
Absolutely, and getting the ball rolling is easy. All you have to do is fill out the form by clicking ‘Sign Up Free’ to apply for an IVA. Our experienced and friendly advisors will go through all of your debt options and tell you straight away whether a government backed debt scheme might be the right step for you. With the growing charges and interest of unsecured debts, it is always the best idea to tackle your debt problems head on with a legally binding agreement before your financial situation gets out of control.
Applying for an IVA has never been easier. The free IVA calculator will tell you whether you qualify for an IVA or not, in under 30 seconds.
Individual Voluntary Arrangements – IVA’s
It gets better:
In your initial assessment, you will not be required to provide any documents (so relax!). The purpose of the initial call is to get a feel of your debt situation and to point you in the right direction. In some cases, an IVA isn’t always the most suitable recommendation. You may be guided towards a debt charity, such as the Money Advice Trust/Money Advice Service or the Citizens Advice Bureau. When you decide to apply for an IVA, you will be asked for:
- Payslips – 3 months payslips will be requested to provide proof to the Insolvency Practitioner of your earnings. If you are not employed, then evidence will be needed of how you receive your income. This is important as we will need to prove that you can maintain payments towards your debts for the 5 year term.
- Bank statements – 3 months bank statements are needed as they will clearly demonstrate the expenditure on your bank account. Online bank statements are usually fine, as long as they clearly display your sort code and account name alongside your name and address.
- Proof of identification – A driving license or passport is fine here, just to satisfy identification checks before your IVA application. You can provide these by post, Whatsapp or through your email address.
The rest of the information needed can usually be accessed through an online credit check which you advisor will complete, once they receive your permission. Your credit rating or credit score will not be affected by the online credit check.
The difference between an IVA and bankruptcy
Just in case you were considering going bankrupt:
You will be allowed to stay in your home. If you mortgage your house and you have a lot of equity in it, you may be asked to release this equity and put the money towards your debts.
An IVA is not advertised.
There are no upfront costs.
You can pay affordable monthly payments based on your income and expenditure.
Your home may be repossessed if you are declared bankrupt. If you rent your property, sometimes assets are seized and sold. This money is given to your creditors towards your debts.
Bankruptcy is advertised in the London Gazette.
There is a one off fee, often around £800.
Deductions may be taken from your future earnings.
The consequences of bankruptcy can be devastating to families, an IVA can be seen as a lighter approach.
Bankruptcy and individual voluntary arrangements are similar debt solutions in the fact they both deal with insolvency issues and are legally binding formal solutions, but they work in different ways. The key difference involves the control of assets, as with bankruptcy control of assets transfers to the official receiver or trustee.
If you are renting your home an IVA will have little effect, but if you file for bankruptcy you may be asked to move if you are in rent arrears. If you own a home, some IVAs will require you to re-mortgage your property six months before the end of the IVA. If this is not an affordable option, the length of the plan could be increased by additional 12 months if money cannot be found from another source. If you file for bankruptcy the receiver will make a decision about your home based on the equity you have, they have two years and three months to decide. With bankruptcy you will need to make sure all debts included are listed to the Official Receiver, in order for them to all be captured in the bankruptcy.
Bankruptcy will be advertised in the London Gazette, insolvency would not be advertised although your name would be listed in the Insolvency Service register which is viewable through an online search. An individual voluntary arrangement would not be advertised.
With bankruptcy you will often just pay a lump sum payment to the Office Receiver to administer your bankruptcy, when you apply for an IVA you would need to pay monthly repayments into a plan. A moderately priced vehicle can usually be kept when you apply for an IVA, while bankruptcy will often mean a vehicle has to be sold, unless it is possible to show that a vehicle is needed to commute to work or is very low value. Within individual voluntary arrangements (IVA’s) you will usually be able to continue using your bank account, providing there are no unsecured debts to the provider such as an overdrawn balance. In bankruptcy it is likely that all bank accounts will be frozen.
Although an IVA is more flexible to changes in circumstances than bankruptcy, there is a longer payment period. Within bankruptcy payments will be required for a maximum of 3 years, but IVAs usually last for 5 or 6 years, meaning it will take longer to clear the debt. Although in both processes all remaining unsecured debt is written off upon completion – see our write off debt page. To discuss debt services further, get in touch via our online calculator and receive free debt advice today.