A lot of people in Debt believe they have only a few options available to them when in debt. Entering an Individual Voluntary Arrangement (IVA) is an effective way to take control of your debts, but it’s not a decision to make lightly. After all, it’s a legally binding agreement with a minimum fixed term of 60 months. This may be extended at your Insolvency Practitioners discretion.

A full income and expenditure review will take place with the Insolvency Practitioner. He will then contact your creditors to determine a plan moving forward. The Insolvency Practitioner will hold reviews with you, usually every 6 to 12 months, with the aim of increasing the month payments in line with an increase in income such as pay rises, windfalls etc. This process can be very intrusive as they will always capture the majority of any income for the IVA to pay off debts, and you will be given monthly expenditure budgets to pay for basics such as food and rent.

As you are providing thorough transparency on your income and assets, if you fail to keep paying your plan, the creditors have all the information they need to consider
further action including petition of bankruptcy, charges on property and other court orders. You will need legal protection before you decide to come out of an IVA, Debt- Rescue can help with this. With protection from our solicitors, once the legal
requests for documentation have been submitted, all enforcement and collection activity is not permitted. Any further attempts for enforcement carried out by your creditors can be defended by our solicitors.

An IVA will not work for everyone, and there are some criteria you need to meet to qualify. Typically, you need more than £5000 of unsecured debt, to 2 or more creditors, and have a regular source of income. Below we have broken down our Debt in Contention service against an IVA so you can compare.