An IVA is a legally binding agreement with your creditors, where the debtor agrees to make one single payment to their debts each month. This is usually over a fixed period of 60 months, and any remaining debt is written off at the end of this period.
If you are eligible for an IVA, it is often the best way for you to become debt free without having to declare yourself bankrupt. No other debt solution can write off any amount of your debt and makes sure that your assets are secured.
An IVA proposal has to be done through an Insolvency Practitioner (IP), who will help you come to an agreement about how much you can afford to pay to your debts each month. Your IVA contributions are based on your incomings and calculated after any priority debts and living expenses.
An IVA will give you protection from your creditors. Once your proposal has been accepted they cannot take any further legal action against you as the IVA contract is legally binding.
Benefits of an IVA include:
If you are a homeowner then the main reason that you would opt for an IVA instead of bankruptcy is that you get to keep your house! Bankruptcy is a very public process and your assets and finances no longer become your own. An IVA is a private agreement and the implications attached are not as long lasting or restrictive.
For free IVA advice and information about why you may wish to choose an IVA, contact our One Advice IVA team on 0800 048 1752, or take the 1 Minute Debt Test.