You might want to consider applying for an Individual Voluntary Arrangement (IVA) if:
- You have a large amount of debt, AND
- It will take you several years to pay back the debt, AND
- You have a reasonable income
An IVA is an arrangement with your creditors to pay them a certain amount of money each month for a certain amount of time. At the end of that time your debts are cleared. The people you owe money to have the right to decide whether or not to accept your IVA offer. An IVA is set up by an Insolvency Practitioner who will charge you for his / her services.
An IVA can often be a better alternative to going bankrupt. For example, you might be able to keep your business if you are self-employed and you can still legally get credit while you are paying off your debt through an IVA. Courts will often consider whether an IVA is more appropriate for someone than bankruptcy.
In some circumstances you can apply for an IVA even after you have been made bankrupt. Your bankruptcy will then be annulled - this means your financial record would be as if you had never been made bankrupt.
If you have been made bankrupt you may also be able to apply for a 'Fast Track Voluntary Arrangement'. This is a type of IVA that is arranged by the court rather than an Insolvency Practitioner. This means the administration costs are cheaper.
If you want to know whether an IVA is a sensible option for you, a debt adviser should be able to help.
Information on other websites
National Debtline
Information about Individual Voluntary Arrangements
The Government's Insolvency Service
Information about insolvency in general including Fast Track Voluntary Arrangements.
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Information Provider:
Manchester Advice
Date Written:
11 April 2005
Date Reviewed:
17 November 2008
This information is for guidance only and is not an authoritative statement on the law. Please read our Terms and Conditions.
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