Frequently Asked IVA Questions

Are IVAs well known as a method of dealing with debt?

IVAs are highly regarded as an ethical and efficient way to deal with the growing problem of debt in the UK. They are well advertised in the media and are increasingly popular as a much better alternative to bankruptcy.

Who is eligible for an IVA?

Anyone with debts over £15000 can apply for an IVA.

What happens if any of my creditors don't agree?

You will need 75% of your creditors to agree to your proposal. If this condition is met the other 25% are legally bound to the arrangement. You will be given the opportunity to listen to any suggestions about the proposal that are made by any of your creditors during the negotiations and it will be up to you whether to decide to accept or reject them.

What happens if my creditors aren’t all in favour?

You may still make an informal arrangement with your creditors if they don't all vote in favour. There is always bankruptcy as a very last resort.

How will my credit rating be affected?

If you accept the conditions of an IVA, you will have to relinquish your credit and store cards and will not be able to borrow until your IVA is completed. However this does not mean that your credit rating is beyond repair. Once you are debt free you can make a fresh start. In this way you will benefit by undergoing an IVA, and your credit rating will eventually be repaired.

How will an IVA affect my current credit?

 Although, as stated above, you will lose your current credit, you may in fact be able to take out or otherwise change a mortgage even during the term of the IVA. Do consult your Insolvency Practitioner for further information regarding this possibility.

Will my home be safe?

Unlike bankruptcy, with an IVA you will probably not have to sell your property. At the end of the IVA, it is recommended that you take steps to re-mortgage your home.

How much will I have to pay into my arrangement?

You will usually pay a monthly sum of at least £200, based on your disposable income and this will be agreed between yourself, your IP and your creditors. is will be agreed between yourself, your IP and your creditors.