Pros & Cons of an IVA

An IVA is a complex legal procedure, and you should fully consider all the IVA Pros and Cons before you start the process.

Debt Helpline are here to offer you free advice, so please contact our advisors on 0808 131 9113. 

IVA Pros.

• All unaffordable debt will be written off.
• Free from unsecured debt in 60 months.
• One monthly payment, that is tailored to your finances.
• You are legally protected from your creditors once the IVA has been agreed.
• You will not have to sell your assets, such as your home.
• Outgoings to unsecured debts will be reduced, meaning that pressure from your secured debts should be alleviated.

IVA Cons

• Your unsecured debts must be greater than £15,000.
• It is a 5 year agreement.
• Failure to make your monthly payment means that creditors can start bankruptcy proceedings against you.
• At least 75% of your creditors must agree to the IVA proposal,
• Your credit rating will be affected for up to 6 years.

Entering into an IVA may adversely affect your credit rating for up to six years from the date of approval.

Your property will be protected within an IVA but you may be required to release all or part of any equity during the period of the arrangement.

Failure to complete the term of an IVA can result in bankruptcy.

(In Scotland, a PTD is the equivalent to an IVA.)