An increasingly popular way to become debt free - what is an IVA?

An IVA (Individual Voluntary Arrangement) is a legally binding debt solution that can be very helpful when you’re in serious debt. Ask the Debt Advice Trust for expert, honest and impartial advice on whether an IVA is the right solution for your debts.

With an IVA you agree to clear all your debts over a period of time (usually sixty months) by only paying off what you can afford. Of course your creditors first have to agree with your provider to write off the rest of your debts. They will do this as long as they agree with the proposal your provider helps you prepare.

When you should consider an IVA

If you’re in serious debt, struggling with repayments and owe more than £15,000, an Individual Voluntary Arrangement can be an effective way of working towards clearing your debts and being able to start afresh. It also avoids all the trauma and embarrassment of bankruptcy. But ask the Debt Advice Trust first for advice on whether it’s the best debt solution for you.

How an Individual Voluntary Arrangement works

If you do enter an Individual Voluntary Arrangement it will be with an IVA provider who will discuss with you how much you think you can afford in monthly repayments, given your financial situation. The provider will then negotiate with your creditors to get them to write off part of your debts so that the remaining amounts can be paid off at the rate of the monthly repayments you can afford.

IVA FAQs

• Q: Why should my creditors agree to an IVA?

  A: They will probably do so if they think that the alternative is receiving less or very little through your bankruptcy. It’s up to your provider to evaluate the situation and put your case forward.

• Q: When can I call the Debt Advice Trust?

  A: You can call us anytime between 8:00 am and 9:00 pm Monday to Friday, or 9:00 am and 5:00 pm on Saturday and 10:00 am to 4:00 pm on Sunday.

More IVA FAQs