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What is an IVA?

If you are struggling with your debt repayments there is a solution available, called an Individual Voluntary Arrangement or IVA, which could help you repay your debts at an amount you can afford.

An IVA usually lasts for 5 years and during this time you pay a monthly payment based on affordability. At the end of an IVA any remaining unpaid debt is legally written off.

Under this initiative you state that you cannot afford your debts. This is done by showing that your monthly living costs are more than your monthly income. By showing what you can afford we then ask your creditors to accept this as your monthly payment.

To qualify for an IVA you should have debts over £10,000 owing to atleast two creditors and you are struggling to make repayments. If you do not qualify for an IVA there may be other debt solutions suitable for your situation.

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How does an IVA work?

In order to set up an IVA an Insolvency Practitioner is required to set up and negotiate the IVA terms with the creditors. An IVA is a legally binding process and once you enter into one your creditors must speak to your Insolvency Practitioner for all matters related to your debts.

Every IVA is different. The terms of your IVA depends on factors such as your employment status, income, expenditure, your total amount of unsecured debts, number of creditors and how you spend your money generally.

Your IVA repayments to the creditors are calculated by analysing all of these factors. A proposal is then created based on the information you provide which details what you can afford to pay towards your debts each month.

The proposal is sent to your creditors (lenders) and a meeting is held with them where they can to decide if they want to agree to the IVA. You do not have to attend this meeting. If more than or 75% of your creditors, by debt value, agree to the terms of the proposal, then your IVA payments can begin, and you will be on your way to paying off your debts and becoming debt free.

On completion of the IVA, any remaining debt will be written off.

Fill in the form if you would like to find out more about an IVA and if it might be a suitable option for dealing with your debts.

Fees and key info

We are happy to provide you with debt advice only. We only charge a fee if you opt for one of our debt solutions. Fees will depend on which debt solution we provide and what your personal circumstances are. All fees will be discussed prior to commencement of any service or debt repayment plan. Click here to read our fees and key info Please note: From time to time we may refer you to other services providers or charities such as the CAB.


If you’d like more information on other sources of free debt help and advice you can visit MoneyHelper – an organisation, backed by government and set up to offer free and impartial advice to those in debt. - Click here to visit MoneyHelper

IVA Advantages and Disadvantages


Below are some of the most frequent IVA questions and answers that we are regularly asked. If you have any other IVA questions, get in touch and we will be happy to answer them for you.

An IVA is an Individual Voluntary Arrangement. It is a legally binding contract between you and the people that you owe money to, your creditors. It is governed by the Insolvency Act 1986 and this normally lasts for 60 months. During this time you pay a fixed amount per month that is then divided up evenly and paid to your creditors. The amount that you pay is based on what you can realistically afford.

In an IVA you will have an agreed budget for your all your living costs. There are allowances made for this in the agreement. These expenses will be mostly based on what you currently have to pay out each month. You should declare all normal monthly expenses to your creditors so they understand your situation more clearly. There may be some restriction on some expenditure items, such as mobile phone for example.

Your IVA payment is what is left after all your living costs have been taken into consideration.

Anything you need to pay on a daily or momthly basis is classed as a living cost. This includes Mortgage/Rent, Food/Groceries, Clothes, Travel/Transport, Car HP, Fuel, Parking costs, Council Tax, Electricity, Gas, Heat and Light, Phone, Mobile, Internet, even Sky TV if you have it. Most of the allowable expenses are included in the debt calculator.

Your IVA payment is relatively easy to calculate. All you need to do is take your living costs from your income.


Income = £1,000

Expenses = £800

IVA payment is £1,000 - £800 = £200

Typically an IVA can last for about five years, but in some cases this can be extended. It is also possible to do an IVA in a shorter period of time, if you can produce a partial or full lump sum of money.

This will depend upon your income, expenditure, and personal circumstances. We treat every case individually. However, you will only pay what you realistically can afford and not what the creditors are asking for. This fixed amount is then paid each month by standing order.

An IVA can be used by nearly all UK residents.

  • Single People
  • Married People
  • Business Owners
  • Homeowners
  • Tenants

Whilst you are in an IVA, you will understandably not be able to obtain credit of any sort and you will have to give up any existing credit that you have. This continues until your IVA is complete. So, your credit rating is not affected forever. When it is finished your credit rating should begin to repair itself.

The fees for an IVA are all set by the creditors (no matter which provider you use), so if your IVA application is successful, the only thing to worry about is whether you have chosen the right Insolvency Practitioner or not.

All fees are taken out of your affordable monthly payment so you will never be asked for additional fees or receive a bill from us.

We work very hard at making your IVA proposal successful, but if for any reason your IVA does not go through, we charge nothing whatsoever.

Most creditors are fully aware of an IVA, as it's been in existence for over twenty years. If 75% of your creditors by value vote in favour of your IVA, then all creditors are bound by its terms. Creditors can suggest alterations to your proposal and you can choose whether to accept them or not. If your creditors vote against your proposal you still have the option of an informal arrangement.

As long as the terms of the proposal have been fully carried out, your creditors will have no further claim against you and the balance of any unpaid debts are written off.

  • You only have to make one monthly payment or in some cases a one-off payment
  • The stigma of bankruptcy is avoided
  • Unlike bankruptcy, an IVA is not reported in local newspapers
  • An IVA is just between you and your creditors, so it's confidential
  • Protection from creditors, once the IVA is agreed your creditors cannot bring any action against you as long as you comply with the IVA.
  • Unsecured debts cleared usually in 60 months
  • An IVA could safeguard your property
  • If you are a homeowner with equity in your property you may be required to introduce part of your share of this equity in the final year of the arrangement. A remortgage may be restricted and on less favourable terms. If you can’t get a remortgage your arrangement can be extended for up to another year.
  • If your circumstances change, and your insolvency practitioner can’t get creditors to accept amended terms, the IVA is likely to fail. You will still owe your creditors the full amount of what you owed them at the start, less whatever has been paid to them under your IVA.
  • If your IVA fails, your creditors may request that you be made bankrupt. This will always be discussed before your arrangement commences
  • Your credit rating may be impacted for up to six years from the commencement of your IVA.

NOTE: In an IVA you will have an agreed budget for your living costs. There are allowances for this in the agreement. These expenses will be mostly based on what you currently have to pay out each month. You should declare all normal monthly expenses to your creditors so they understand your situation more clearly. There may be some restriction on some expenditure items, such as mobile phone for example.

If the bankruptcy hearing has not taken place then our Insolvency Practitioner would issue an Interim Order to halt proceedings while an IVA proposal is put together. If the bankruptcy order has already been issued it is still possible to propose an IVA but it is more difficult. Remember any court fees will be added to your debts.

Initially all you need to do is simply complete the IVA online application form. By doing so you are asking us to review your current circumstances and advise whether an IVA is indeed the most appropriate solution to your problems. Once we receive your information we will either confirm an IVA as appropriate or offer alternative solutions.

If an IVA is deemed appropriate, and you still wish to pursue this option, we provide you with an opportunity to ask one of our specialists any further questions you may have. We will then produce your "Proposal to Creditors" which explains in detail the circumstances of your current problems and your proposals to repay what you can reasonably afford.

The proposal is sent to you for review. If you're happy with everything you sign the proposal and we commence formal negotiations with all your creditors to put the IVA in place. At no time throughout this whole process (usually 6-8 weeks) do you pay any monies over to us.

Types of IVA

Joint / Interlocking IVA

A Joint IVA is an IVA application where both applicants (husband and wife or partners) have debts, either individually or jointly. Anyone who is eligible for an IVA and has joint debts with a husband/wife/partner can enter into a joint IVA.

Lump Sum IVA

A Lump Sum IVA is an IVA application where all the debts are paid off via a lump sum contribution. In these cases the IVA can take just a few months to complete. The lump sum could come from releasing equity from your property, or from a third party such as a friend or family member.

Even if your debt is much more than your available equity, you may be able to get your creditors to write off off some of your debts and accept your equity release as a full and final settlement through the lump sum IVA. The lump sum IVA differs from a normal IVA as it can be done via just 1 payment instead of 60 monthly payments.

The lump sum should generally be at least 25% of the total debts, plus enough excess left over to cover the costs to the creditors.

Assisted Payment IVA

An Assisted IVA is an IVA application where the debts are all in one name. While a husband/wife/partner is not obliged to pay for their partner's debt, it may give the IVA a better chance of creditor acceptance if they contribute to their husband/wife/partner's IVA. We can advise you whether an Assisted IVA is possible or necessary.

Debts which are owed jointly with another person can also be included in an assisted IVA.

Business IVA - Self Employed and Sole Trader

A Business IVA is an IVA application where the applicant is a sole trader and the debts are both business and personal debts. If necessary this type of IVA can also be set up to ensure the business remains trading.

Our IVAs are processed by our Insolvency Practice

All our IVAs are processed and managed by McCambridge Duffy Insolvency Practitioners, our sister company. McCambridge Duffy have been established since 1932 and have been helping people deal with their debts for decades. They have 5 full time Insolvency Practitioners, more than any other IVA firm.

Things to consider

  • All our initial advice is free. A fee is only payable where further services are requested. If you proceed with an IVA there are fees payable as all IVAs must be provided by a professional Insolvency Practitioner, like a lawyer. Our fees are included in your monthly payment to your creditors so you will not have to pay anymore than you can afford. More suitable debt solutions may be offered which may result in different fees applying and we will discuss those with you during your initial consultation.
  • Creditors may still contact you with promotional material or to fulfil contractual obligations to you but they should deal with us in all aspects relating to the outstanding debts.
  • Acceptance of your IVA cannot be guaranteed but we will do our best. You must meet certain criteria which will be discussed with National Debt Relief advisors. Where we put a client forward for an IVA we believe they have an excellent chance of being accepted.
  • Debts will only be written off where a client has made an agreed payment for a fixed period. In return the creditors agree to write off the remaining balance. Typically, our clients average debt write off is between 60-70% of the debt. What debt you have written off will depend on your individual circumstances and is subject to creditor approval and completion of the IVA.
  • Your credit rating may be impacted for up to six years from the commencement of you IVA.
  • Homeowners may be required to introduce equity if available.

Apply for an IVA

IVA Factsheet

IVA Factsheet

Download and keep our Factsheet, so you can read up about an IVA at a time that is convenient to you. If you are looking for an alternative to a IVA, we can advise on the full range of Debt Solutions in the UK, so please get in touch if you would like to find out all what options are most suitable for your situation.

View IVA Factsheet
Email Debt Advice

Email Debt Advice

If you would like to find out more about the options available, but are hesitant to chat about it over the phone, use our "Email Debt Advice Service" for initial conversation.

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IVA example

Client Name :
Ms W

Total Debts of £15,500

Total monthly repayments before IVA

£470 per month

Total monthly repayments after IVA

£160 per month

Ms W was struggling to pay creditors £470 per month to stay afloat with her debt repayments. She contacted us and we discussed her options. She decided to enter into an IVA. On acceptance of her IVA proposal, her monthly repayments were reduced down to a more affordable £160 per month. After 60 monthly payments and successful completion of her IVA, she will be debt free, having repaid 64% of her debts and writing off the remaining 36%.