An IVA, or individual voluntary arrangement, is a debt solution similar to bankruptcy for people with unsecured debts of £15,000 or more. It is a legal procedure which needs careful thought and advice.
If you are unsure as to whether an IVA or bankruptcy is more suitable for your situation, contact us for free, impartial and confidential advice. Our online debt counselling service, CCCS Debt Remedy, can identify the most appropriate solution for your circumstances. Neither solution should be entered into lightly and without a great deal of thought, as there are legal implications that may affect your home and your employment.
In the meantime, here are some facts about IVA and bankruptcy.
IVAs
An individual voluntary arrangement often allows you to keep key assets such as property.
An Insolvency Practitioner will propose to your creditors that your available income (after allowing for payments to your household bills) is used to pay monthly instalments towards your debts over a fixed term of normally 5 years. When the repayment period has ended, the remaining debt is written off.
Creditors representing 75% or more of your total debts need to vote in favour of the arrangement for the IVA to go ahead.
Bankruptcy
Bankruptcy is a legal process for people who can no longer pay their debts within a reasonable time. For bankruptcy to be a viable option, your unsecured debts must outweigh your assets, including property and vehicles.
Under personal bankruptcy, creditors write off your unsecured debts. However, bankruptcy should not be entered into lightly because you will be subject to various financial and business restrictions and you might have to give up key assets such as property.
For IVA and bankruptcy help, advice and information
Contact us through CCCS Debt Remedy. As the UK’s number one debt help charity, we can identify the best debt solution for you and help you every step of the way.