England, Wales & NI
Individual Voluntary Arrangement
A legally binding agreement to pay back an affordable share of what you owe over a fixed period, usually five years.
- Typical term
- Usually 5 years
- Type
- Formal insolvency
- Available in
- England, Wales & NI
What it is
An IVA is arranged by a licensed insolvency practitioner and, once approved by enough of your creditors, it binds all of them. You make one monthly payment you can genuinely afford, and any remaining qualifying balance is written off at the end.
Who it tends to suit
- You live in England, Wales or Northern Ireland
- You owe roughly £6,000 or more to two or more creditors
- You have a regular income and something left over each month
Benefits
- One affordable monthly payment instead of many
- Interest and charges are frozen once the arrangement starts
- Creditors covered by the arrangement must stop contacting you directly
- Any qualifying balance left at the end is written off
Things to weigh up
- It appears on your credit file for six years from the start date
- Homeowners may be asked to try to release equity near the end of the term
- Fees apply and are taken from your monthly payments
- If payments stop, the arrangement can fail and creditors can act again
If you own your home
Homeowners are usually asked to look at remortgaging in year four or five. If that isn't possible, the term is often extended rather than your home being at risk.
Not sure this is the right fit?
The finder compares this against every other UK route based on where you live and what you owe.
Compare my optionsMay not be suitable in all circumstances. Fees apply and your credit rating may be affected. Arcadia is an information service — always consider free, independent advice before deciding.