Individual Voluntary Arrangements were introduced by the Government under the Insolvency Act  1986 and provide an alternative to bankruptcy. They can only be set up by a licensed Insolvency Practitioner and enable an individual sinking under debt  to stave off bankruptcy by coming to a legally binding agreement with their creditors to pay off a percentage of their debts over a five year period. In return creditors agree to freeze interest charges and write off the balance remaining at the end of the agreement.

Essentially you are trying to strike a deal with your creditors by saying you can't pay in full, but are prepared to put a percentage of your income on the table which might mean they will get something like 25 to 50% of their money back.

There are a number of advantages with an Individual Voluntary Arrangement and they provide a way out of debt, providing your circumstances make you a suitable candidate. 

If an IVA is the most appropriate course of action, a licensed Insolvency Practitioner will work with you to put forward a proposal to your creditors which will form the basis of the agreement.

An IVA proposal shows your creditors your current financial position and explains how much you can afford to pay over a period of 5 years. Provided most of your creditors agree, all your debts will be included in the agreement and you will be protected against any action being taken against you by any of your other creditors.

The number of people taking out an IVA has soared in recent times as increasing numbers of consumers have realised they can no longer cope with the high levels of unsecured borrowing they have taken on. Most industry analysts estimate there are in excess of a million people in the UK who are over indebted and struggling with significant debts.

If you are struggling with debt, you should seek expert advice now. Your problems are not insurmountable.

To get expert and impartial advice from a licensed Insolvency Practitioner, simply complete our no obligation enquiry form. Our advisors are friendly, professional, knowledgeable, and will explain the options available to you, clearly and concisely.