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Advice On UK IVAs:
Guide To Individual Voluntary Arrangements
Go Straight To Recommended IVA Providers
Or Complete Our Online Form To Apply For An IVA Now
Residents of Scotland Should Refer To The
Protected Trust Deeds Page
See Also IVA Questions For Quick Answers to IVA FAQs, and
Read About The Disadvantages Of An IVA
This page is only relevant to UK citizens as IVAs do not exist outside the UK. The nearest equivalent process for US residents is Debt Settlement, which also involves writing off large portions of your debts.
IVAs are not available in Scotland, but the equivalent is called a Trust Deed, which works in very much the same way and achieves the same result. Please refer to the Trust Deeds page for further information and recommended providers.
Individual Voluntary Arrangements are formal agreements between you and the people you owe money to (your creditors). Under the agreement you arrange to make certain payments over a fixed period of time, in full and final settlement of the debts. It is often seen as preferable to the publicity and stigma associated with bankruptcy.
Under an IVA, you will normally be required to make regular monthly payments to your creditors out of your surplus income, over a period of up to five years. The amount of your debts will be frozen at the date the IVA is agreed, and interest will generally not continue to build up.
If you keep up your payments you should be debt free at the end of the five year period, often with a large proportion of your debts written off. This is, however, dependant on the approval of your debtors. At least 75% of creditors (by value of the debt) need to agree to the terms of Individual Voluntary Arrangements. Any creditors who do not agree to these terms are still bound by them, provided they are accepted by those owed over 75% of the debt.
IVA UK Advice - What Is The Cost Of An IVA?
Writing off a significant proportion of your debt is a very attractive proposition, though you need to be aware that there is still a cost associated with setting up and running an IVA. The costs of setting up Individual Voluntary Arrangements, however, should still be less than the cost of filing for bankruptcy, and there are far fewer lasting consequences with an IVA. A company who arranges an IVA for you will be taking their fee out of the payments you make to creditors, but considering that a substantial proportion of your debt should be written off, an IVA should more than make up for this and still be well worthwhile.
All Individual Voluntary Arrangements are negotiated, set up and maintained by an Insolvency Practitioner (a lawyer or accountant). The Insolvency Practitioner will help you put together a proposal and arrange a meeting with your creditors to discuss it.
Remember that if you don't keep up with the payments you agree, you can still be made bankrupt.
IVA UK Advice - The Advantages of An IVA
- Up to 75% of your debts could be written off
- You don't have the stigma and publicity that bankruptcy brings (an IVA is a private arrangement and not even your friends and family need to know about it)
- You should not be required to sell your home
- You are debt free in up to five years
- You only have to pay back what you can actually afford
- The IVA's set up costs are lower than for bankruptcy, so you should be able to offer more to creditors
- You only have one monthly payment to consider
- You are involved in setting up the agreement and deciding what assets are made available to creditors
- If you are in business you can continue to trade, and you are not prevented from being a company director or working in certain sectors, as you would be with bankruptcy
- Any creditors who oppose the terms of the agreement are still bound by its terms, provided at least 75% sign up
- An IVA stops creditors harassing you for payment and protects you from legal action
- You can still operate a normal current account, provided you don't want an overdraft facility.
IVA UK Advice - Other Considerations To Be Aware Of
- Usually only applicable if debts are usually at least £15,000
- You will not be able to take on any unsecured borrowing during the course of your IVA
- Will only work if at least 75% of creditors agree to the terms
- If you fail to keep up payments under the IVA's terms, you could be made bankrupt and have the IVA's costs added to your total debt
- Future applications for credit could be affected by the IVA's record on a public register, even after the IVA has expired
IVA UK Advice - How To Arrange An IVA
The main thing you need to do is to ensure that you get quotes from at least two or three reputable debt management companies. Rates and offers will vary enormously and there are a lot of companies out there who care less about solving your long term problems than they do about getting a fee out of you.
The following are recommended starting points for some well established and reliable organisations who will be able to offer you professional advice and give you an answer quickly. Consult at least two of these and you will be off to a good start.
Some of these companies may advise you that an IVA is not the most appropriate solution for your circumstances, and offer an alternative route. Remember that an IVA is a very specific thing, so please:
Do not go to the trouble of completing the application processes for these companies unless you at least meet the following criteria:
- You are a UK Resident
- You are struggling to repay at least 2 unsecured debts such as loans, credit cards, overdrafts, bills, etc
- Your unsecured debts total at least £5,000
- You are looking for an IVA or debt management help, NOT a loan
- You should have at least about £90 per month available to pay towards your unsecured debts
Please note that IVAs cannot help with secured debts, such as mortgages, loans secured on your house, or council tax arrears.
If you are interested in a loan to cover your debts instead, visit the debt consolidation loan page instead.
If the above criteria describe your situation, the following companies can definitely help you change your life...
Recommendations For The Best UK IVA Companies
Remember - It Is Best To Apply To A Few And Compare Results
Top Recommendation For IVA UK Help: 123DebtSolutions
This is my top recommendation for an IVA provider, so I have added an Online Form to this site to make it easy for you to get debt help from 123DebtSolutions.
This company specialise in helping UK residents to get out of debt, and offer a range of solutions including debt management plans and IVAs.
An experienced debt advisor will be appointed to deal with you throughout the process and you will get regular updates to show you exactly how things are progressing. They will stop your creditors contacting you and try to reduce the interest charges you pay.
To be offered an IVA proposal by 123DebtSolutions, you will need to have at least £15,000 worth of unsecured debt to at least two creditors. Complete the simple online form on their website and they will get straight back in touch with you to discuss your situation. Alternatively, you can apply direct using the application form on this site.
Best IVA Company: SolveMyDebt
Well established and respected, SolveMyDebt have a team of expert debt advisors who will go through your situation with you and tell you if an IVA is likely to be the best solution for your situation. They also offer debt management plans, so even if you are not eligible for an IVA, they may still be able to assist you.
To apply for a IVA you must be:
- UK Resident
- over 18 years of age
- Normally have at least £15,000 in unsecured debts to at least two creditors
To find out how they can help, just visit their website and fill in the simple 'urgent enquiry' form on left of page. Make sure you enter your contact details accurately and fully, and complete the other basic information required. An advisor will then make contact with you to see if an IVA will be the best solution to your problem.
Best IVA Company - Express Debt Solutions
EDS have many years experience and pride themselves on taking a personal approach to every customer and coming up with a solution to meet your particular needs.
Well known for friendly and professional service, they will advise you on all your options and leave the final choice up to you, without pressurising you.
Minimum requirement is for unsecured debts of at least £10,000.
Just go to the homepage of their website and click on the "Apply Online" button to complete their online application form.
