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Individual voluntary arrangement

What is an IVA?
An IVA is an alternative to bankruptcy, and is a legal arrangement that you make with your creditors to repay your debts based on your current circumstances. They are often used by individuals and the self-employed.

You should be aware that an IVA will only deal with your unsecured debts, and not your secured debts such as your mortgage. They are normally used to deal with debts run up on credit cards, personal loans, store and charge cards, tax liabilities, and utility bills.

What are the benefits of an IVA?
An IVA can provide a valuable opportunity to take stock of your finances and get professional help to put in place an arrangement with your creditors, starting the process of getting your finances under control. They are generally suitable for people with debts of £10,000 and over, and they are normally required to make payments of a minimum of £200 per month.

The IVA will freeze the interest accruing on your debt, making it easier to form a clear picture of how much you owe and how much you will be able to pay back. The amount that is usually repaid under this type of scheme is generally less than the total amount of the debt, so it can prove a useful way of getting out of financial difficulties. It will also mean that you have protection from your creditors and won’t be pursued by them, as long as you fulfil the terms of your agreement.

An IVA is time-limited, and you only have to repay for the period of the IVA, usually five years.

HW Fisher & Company can help you construct a proposal that is reasonable and achievable and submit it to your creditors. By law you will need to work with a Licensed Insolvency Practitioner, and we regularly act in this capacity on behalf of clients.

 

Individual Voluntary Arrangement

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