What is an IVA? Individual Voluntary Arrangements Explained | FREE Advice

IVA - Individual Voluntary Arrangement

If you are struggling with debt you may wish to consider an IVA (Individual Voluntary Arrangement) or a debt management plan to help you manage the repayment of your debt.

What is an IVA?

An Individual Voluntary arrangement is a legally binding agreement with your creditors to repay what you owe over a set period of time. They usually stretch over 5 years and offer the comfort that your debts will be cleared after that time.

What does an IVA provider do?

An IVA provider is the company that provides you with this service. They will negotiate with all your creditors on your behalf and arrange your new, affordable repayments. Going through an IVA provider makes paying off your debt easier as you have one monthly payment rather than several and it relieves a lot of the stress associated with debt as you do not have to deal with your creditors directly, this is all done for you.

What are the benefits of an IVA?

An IVA is a government backed scheme, it is beneficial for those in debt problems because your debt is restructured, giving you one monthly payment and the knowledge that you will be debt-free after the given time period. Creditors will also agree to wipe debt that you simply cannot afford to pay, making a settlement instead, and agree not to chase you for payment. As you can imagine this relieves a lot of the emotional stress associated with mounting debt as you can work towards paying it off without the worry of creditors’ threats and demands.

Who should consider an IVA?

If you have debts over £15,000 and are in full time employment then considering an IVA could be a way of restructuring your debts so that they are more affordable. If you are in debt and it is causing you undue stress and worry, then an IVA could relieve you of this tension, help you clear your debt and allow you to get on with your life.

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