Individual voluntary arrangements

An IVA, or individual voluntary arrangement, is a legal process for people with unsecured debts of £15,000 or over. It may be used as a way of repaying your debt, which avoids bankruptcy. However, it is still a legal procedure which needs careful thought and advice.

An Insolvency Practitioner (IP) arranges an IVA for you. They assess your finances and draft a proposal for your creditors. The plan will involve you paying affordable monthly payments towards your debt over a fixed period which is normally 5 years. Once that period is over, any remaining debts are written off.

Your creditors take a vote on the proposal at a specially arranged meeting. Creditors representing 75% or more of the total debt must vote in favour of it for the individual voluntary arrangement to go ahead.

What happens next?

You will be required to make the monthly payments, as set out in the proposal. As long as you fulfil the terms of the agreement, no legal action can be taken against you to recover the debt. Your finances will be reviewed annually by the IP and you will receive a progress report every 12 months. You will also be notified when the IVA has finished.

Information on IVAs and advice

Free, impartial IVA information and advice is available from CCCS. If you use our online service, CCCS Debt Remedy, we can tell you if an IVA is suitable for your circumstances. We will also make recommendations if there are more suitable debt solutions for your needs.