Starting an IVA

Who Can Use An Individual Voluntary Arrangement (IVA)?

The use of an IVA as a way to solve your debt problems is available to anyone. Your ability to undertake an IVA is based on your financial circumstances and not your job or profession.

An IVA can help anyone who is experiencing difficulty managing their level of debt, and is particularly beneficial for those people who own property which may be at risk if they were to be made bankrupt.

An IVA might benefit you if:

• Your creditors will not agree to an informal debt management arrangement
• You have already tried other, more informal methods of tackling your debt, but these have failed
• You owe money to too many creditors making the option of an informal debt management arrangement impractical
• You are facing the threat of bankruptcy, or you have already been made bankrupt and want to reverse the situation

Other benefits of an IVA:

• If you are running a small business it would be difficult to continue to trade if you were made bankrupt as you would find it difficult to obtain supplies and may be committing a civil offence if you sought to obtain credit whilst an undischarged bankrupt.
• In certain professions, such as accountancy/police/armed forces, if you were to be made bankrupt, you could lose your job.
• You may be able to raise a one off large lump sum, and want a formal arrangement with your creditors to accept the lump sum and write off the remaining debt.
• Your surplus income each month may be sufficient to allow you to meet your monthly domestic expenditure and make monthly payments to your IVA.
• You will not automatically lose your house or other assets as they can be kept out of the IVA. However, creditors will usually require a lump sum contribution from the equity in your house. See the section on Disadvantages of an IVA.