Individual Voluntary Arrangement

Individual Voluntary Arrangement

An Individual Voluntary Arrangement IVA is a method of repaying your debts to creditors in one monthly lump sum. It can be a good way to control your finances and is a viable alternative for those threatened with bankruptcy.

As with all debt problems you should move to seek help and advice as quickly as possible to prevent your situation becoming any worse, this can be hard to do as a lot of people do not to talk about their money matters. A good adviser will assess your debts and offer you a course of action, one such course could be an Individual Voluntary Arrangement IVA.

Individual Voluntary Arrangement IVA Eligibility

To be eligible for an IVA your debts must be over a certain amount, this is generally £15,000. It is required that the money you owe is to three or more creditors and that you have the funds available to make regular monthly repayments. The minimum you need to repay per month is £200, the chances are you are already paying way over this figure as it stands meaning around £200 could be a huge saving.


An Individual Voluntary Arrangement IVA needs to be conducted by a licensed practitioner as it is bound legally by courts. Make sure that you find a company to work on your behalf that you are comfortable with as your relationship with them will stretch over the six or seven years of the IVA. You are asked to provide a full breakdown of what money is coming in to your household and how much is going out, from this the figure you can afford to pay to creditors will be drawn up. This figure will be put to your creditors at a meeting, if your creditors are happy with the terms and conditions (75% of them must agree) then the IVA can be put in place.

During and After the Individual Voluntary Arrangement

During the IVA all that is required of you is that you continue to make the agreed repayments on time each month. The company acting as the supervisor of the arrangement will take care of all contact with your creditors' as-well as making sure each one receives their dividends. It is important to keep up with repayments or it could result in being declared bankrupt.

Your home is free from the threat of repossession during the IVA as are assets you may have.

An IVA stays on your credit rating for six years, during the term of the arrangement it is forbidden that you take on any more debt as this could hinder and is seen as a possible contributing factor if you do start do miss payments.

After the IVA has ended any leftover unsecured debt is that was included in the IVA is classed as settled. You are free to apply for fresh credit from lenders but will have to be prepared for high interest rates and larger repayments due to the IVA being on record.

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