An IVA is a legally binding agreement between the debtor and his/her creditors. With an IVA you can significantly reduce your debt, stop being charged a high level of interest, save your home and possessions and negotiate a monthly payment which is much smaller and easier to manage than what you are paying right now.



How does an IVA work?

Once you have decided that an IVA is the best solution for you an Insolvency Practitioner (IP) will assess your financial situation and decide on a repayment amount. An application form will be sent to the court for an Interim Order following which no creditor can take legal action against you. For an IVA to be approved a creditors meeting will be arranged which you should attend. During the course of this meeting creditors will be called upon to vote for or against the arrangement. If the creditors vote for the IVA it gets approved immediately. However if creditors who represent 25% of your total debt vote against it the meeting will be suspended for a later date. Therefore an IVA needs the support of 75% of the creditors who represent your total debt.

Your IVA has been approved. What Next?

Once your IVA has been approved your IP assumes the role of tracking your IVA's progress.  It is your responsibility to pay the agreed repayment amount every month to the IP who will ensure that the payment is distributed among your creditors as agreed upon earlier. When the term of your IVA agreement is over you will be free from your debts no matter how much has been paid off. Remember if you fail to keep up to your monthly repayments it could result in the failure of your IVA.

The IVA Advantage


Did you know that nearly half of the Insolvencies in 2006 were IVA's?

During the year 2006 ?1.4 billion of debt written off by creditors and UK broke over 100,000 insolvencies. 2006 appeared to be a year of increasing unemployment and rising bills which left hapless debtors turn to IVA to help ease their debt burden.