What Is An Individual Voluntary Arrangement?

An individual voluntary arrangement (IVA) is a formal agreement allowing you to make affordable payments to your debts, usually over 60 months. At the end of your IVA any unsecured unaffordable debt left is written off. You can also make a one-off payment known as a lump-sum IVA. Sometimes, incorrectly referred to as an Individual Voluntary Agreement. In Scotland, the equivalent solution is known as a Protected Trust Deed.



How Does An IVA Work?

An individual voluntary agreement (IVA) is an agreement between you and your creditors to help you pay off your debts at an affordable rate. For your IVA to be approved, at least 75% of the value of creditors who vote at the meeting of creditors need to vote in favour of your IVA proposal. In order to find out if you qualify for an IVA, a debt expert will run through your income and expenditure details and work out what's known as your disposable income. This is the figure that will be proposed to repay your debts. Don't worry, the partners used by Debt Support Line have an acceptance rate of over 93%. If you do not qualify for the IVA criteria - we can help with alternative solutions. depending on your situation, those solutions may actually be more beneficial for you.

An IVA is a legally binding agreement between you and your creditors. This means if you have an IVA and stick to the agreement you’ll get protection from your creditors taking further action against you and some of your debt will be written off.


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Individual Voluntary Arrangements - Pros and Cons

The Individual Voluntary Arrangement is available for residents in England, Wales and Northern Ireland

IVA Advantages

    • You could be debt free in 5 years
    • All harassment from creditors will be stopped
    • You will only need to pay one affordable monthly payment

IVA Disadvantages

    • Your credit rating will be affected
    • You will not be able to take out any other credit whilst you’re in the IVA
    • If you don’t maintain your payments, your creditors can add new interest and charges