An IVA (Individual Voluntary Arrangement) could help people carrying unsecured debts worth around £15,000 or more.
An IVA could help you:
If you are struggling with a high level of unsecured debt that you can’t afford to repay within a reasonable amount of time, but that you can commit to making regular reduced repayments towards, an IVA (Individual Voluntary Arrangement) may be the right debt solution for you.
An IVA is a formal, legally binding agreement between you and your unsecured creditors, which will – in most cases – last for a total of 5 years.
To be eligible for an IVA, you must be able to commit to making regular reduced payments for the duration of the agreement. If you can commit to this – and your IVA is approved by enough of your lenders – they will agree to write off the portion of your unsecured debt that you can’t afford to repay once the IVA has come to a successful conclusion.
Before an IVA begins, you and your Insolvency Practitioner (IP) would draw up an IVA Proposal, which would show your creditors what you could realistically afford to pay in an IVA.
For the agreement to go ahead, the IVA Proposal would have to be accepted by voting creditors accounting for 75% or more of your debt. If it is, the IVA will become legally binding on all your unsecured creditors, including any who didn’t vote or who voted against it.
As with any debt solution, an IVA has its advantages and disadvantages. Here’s a look at some of these, to help you decide whether an IVA might be a suitable debt solution for you.
Subject to eligibility and acceptance. Debt write off applies to unsecured debts and only on completion of an IVA, alternative solutions may be offered. Calls are usually free from UK landlines but call charges from mobiles may vary.