Advice / Information


IVA Pros and Cons



An IVA will enable you to reduce your debts to one affordable monthly sum (based on your budget) which is usually fixed over a 60 month period. Monthly repayments can be as little as £100 per month, and after you have completed the IVA, whatever debt is remaining will be cleared, which could be up to 75%, leaving you debt free. Other benefits of an IVA include:

  • Freeze all creditor interest that you pay
  • IVA will cut the amount that you owe which could be up to 75%
  • Prevent creditors taking any legal action against you
  • No Restrictions to obtaining personal credit
  • It is a private agreement, It is not publically advertised unlike bankruptcy
  • Professional status not affected, you can continue to trade (i.e. company director, solicitor)
  • One affordable monthly repayment
  • Debt Free within 5 years
  • An IVA will allow you to keep your House and Car
  • Avoid Bankruptcy
  • Your IVA will be dealt with by a licensed insolvency practitioner

Disadvantages of IVA:

  • An IVA will have a negative effect on your credit rating making it difficult to obtain credit
  • Failure of an IVA may result in bankruptcy proceeding
  • 5 year period for an IVA compared to a maximum of 3 years with bankruptcy
  • You must be able to afford a monthly payment, usually over a minimum of £100 per month
  • IVAs are usually only suitable for debts over £10,000
  • You will end up paying more back to your creditors than you would in bankruptcy
  • All creditors must be included, you cannot make separate arrangements