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Apply for an IVA

Individual Voluntary Arrangement (IVA)

An Individual Voluntary Arrangement (IVA) is a legally binding formal agreement between you and your unsecured creditors. It allows you to repay a proportion of your debts through affordable monthly payments over an agreed period, with the remaining balance written off at the end. Our advisers will assess your circumstances and explain whether an IVA is appropriate for you.

Advantages and Disadvantages of an IVA

An IVA can provide a structured, protected route out of problem debt — but it is a serious commitment with lasting implications. Read the balanced summary below.

Potential advantages

  • Legally binding — once approved, creditors cannot take further legal action for included debts
  • One affordable monthly payment for a fixed term, typically 60 months
  • Any remaining unsecured debt included in the IVA is written off at the end of the term
  • Fees are built into your monthly payment — nothing is paid upfront
  • Protects your home in most cases (though equity may need to be considered)
  • Creditors must vote to approve the IVA — 75% by debt value is required, binding all included creditors
  • Provides a fixed end date and a clear path to resolution

Potential disadvantages

  • Requires creditor approval — if creditors holding 75% by value reject it, the IVA does not proceed
  • Recorded on your credit file for 6 years from the start date
  • Your name appears on the Individual Insolvency Register, which is publicly accessible
  • Homeowners may be required to attempt to release equity in year 4 or 5 via remortgage; if unsuccessful, the IVA may be extended by 12 months
  • Any windfall received during the IVA (inheritance, bonus, etc.) may be required to be paid in
  • If the IVA fails due to missed payments, you may be made bankrupt — with more serious consequences
  • Certain professional roles and employment contracts may be affected — check your contract before proceeding
  • Does not include secured debts (mortgage, secured loans) or excluded debts (student loans, child maintenance, court fines)

Whether this solution is right for you depends entirely on your individual circumstances. Our advisers will assess your situation and explain all available options before any recommendation is made.

What is an IVA?

An IVA is a formal insolvency procedure available in England, Wales, and Northern Ireland. It is set up and administered by a licensed Insolvency Practitioner (IP). Under an IVA, you make one affordable monthly payment for a fixed term (typically 60 months). At the end of the term, any remaining unsecured debt included in the IVA is written off.

Because it is legally binding, creditors who are bound by the outcome cannot pursue further legal action against you for included debts.

Eligibility

An IVA is generally considered if you:

  • Have unsecured debts of approximately £10,000 or more owed to two or more creditors
  • Have a regular income that allows a meaningful monthly contribution
  • Are not currently bankrupt
  • Live in England, Wales, or Northern Ireland

If you are a homeowner, equity in your property may need to be considered as part of the IVA. Your adviser will explain how this affects you.

How an IVA Works

  1. Assessment: Your income, expenditure, debts, and assets are assessed to calculate an affordable monthly payment.
  2. Proposal: A licensed Insolvency Practitioner drafts a formal proposal on your behalf and sends it to your creditors.
  3. Creditor vote: Creditors holding 75% of the debt value (by value) must agree for the IVA to be approved.
  4. Payments: You make monthly payments to your IP, who distributes funds to creditors.
  5. Completion: After the agreed term (typically 60 months), the IVA ends and all remaining included debts are legally written off.

Fees Within an IVA

There are fees associated with an IVA — a nominee’s fee for setting up the arrangement and a supervisor’s fee for managing it. These fees are built into your monthly payment and agreed with creditors as part of the proposal. You do not pay them separately on top of your monthly contribution. Your adviser will explain the full fee structure before you commit to anything.

What Happens if an IVA Fails?

If you miss payments and the IVA is terminated, you will still owe your original debts (minus any amounts already paid), and your IP may petition for your bankruptcy. This is why it is essential that your monthly payment is set at a genuinely affordable level from the outset. Our advisers take this seriously and will not recommend an IVA unless your income genuinely supports it.

Important Note on Referrals

IVAs must be set up and administered by a licensed Insolvency Practitioner. Where our assessment indicates that an IVA is appropriate, we refer clients to an appropriately authorised insolvency practitioner.

Talk to one of our advisers

Complete the form below and one of our advisers will be in touch. There is no obligation and everything is treated in the strictest confidence.

Debt solutions may affect your credit rating and are not suitable in all circumstances. Your individual circumstances will be assessed before any recommendation is made. To find out more about managing your money and getting impartial debt advice, visit moneyhelper.org.uk. Help with Debt Ltd (FCA FRN: 1058208) is an Appointed Representative of Dee Valley Finance Limited (FRN: 811106), authorised and regulated by the Financial Conduct Authority.