debt
IVA Individual Involuntary Arrangement
An individual voluntary arrangement (IVA) is a formal agreement which allows you to make payments to your creditors, usually over five or six years.
Bankruptcy is a legal process usually suitable for people who little hope of paying back their debts in a reasonable time and whose circumstances are unlikely to change.
What is IVA
An individual voluntary arrangement (IVA) is a formal agreement which allows you to make payments to your creditors, usually over five or six years. At the end of your IVA any unsecured debt that has been included in the arrangement is written off. There is no limit to the amount of debt that can be included in IVA and most unsecured debts can be included. An IVA can help to make unmanageable debts affordable again by reducing your debt repayments to an affordable level again and making sure that you have enough left over for your bills and other living costs.
When you enter into an IVA a proposal will be put to your creditors and if 75% of them (by debt value) agree to the proposal, then the IVA will be put into place.
An IVA is only available in England, Wales and Northern Ireland. If you are in Scotland a similar solution is a Trust Deed.
Benefits
You make one monthly payment usually for a period of 5 years
Interest and charges are frozen if the IVA is accepted
If you are a homeowner, you can keep your home providing that you maintain payment towards your mortgage any secured loans
There are no set up fees with an IVA. Any fees charged by the Insolvency Practitioner are usually included within your monthly payment
Considerations