Get Out Of Debt With an IVA
Pay off your debts at an affordable rate.
Write-off what you can’t afford.
A single, affordable payment
Pay what you can each week/month.
Debts significantly reduced
Repay part of your debts to clear them in full.
No more interest nor charges added.
All benefits and risks explained in an easy to understand way.
How does an IVA work?
An IVA (Individual Voluntary Arrangement) is a legal agreement between you and those you owe money (your creditors).
You agree to pay off a percentage of your debt over a given period of time, by means of affordable repayments (normally 60 months).
If you owe more than £6,000, are struggling with payments but can afford at least £80 per month - an IVA may be the right debt solution for you.
Applying For An IVA
When you contact us we will chat about your current situation, including your income, outgoings and debts. This will tell us if an IVA is a good option for you.
Should an IVA be suitable - the next step is to draw up an IVA proposal for consideration by your creditors.
If the proposal is approved all creditors are bound by its terms. All debts are frozen so no more interest or changes can be added.
Being In An IVA
Creditors must not chase you for payments for any of the included debts. So, no more letters, phones calls nor threats of legal action.
Provided you maintain payments - unpaid debt is written off at the end of the IVA, which typically lasts 60 months.
Your expenditure is expected to keep within reasonable guidelines - but you won't be asked to live in poverty.
Debt Includable in an IVA
Most debts can be included and repayments reduced
Loans & Overdrafts
Store & Credit cards
Benefits over payments
HMRC & Council tax arrears
Debts with a Court Judgement
Rent, Gas and Electricity arrears
Catalogues & Buy now – pay later agreements
For other debts contact Debt Guardians for clarification
Unsecured debts only. Certain debts cannot be included in an IVA such as; criminal court fines; debts obtained by fraud; child support arrears and most student loans.
Key benefits of entering an IVA
Repayments to creditors are based on what you can afford - not how much you owe.
Once you have made the agreed contributions any remaining money owed is written off.
A sense of control
An IVA allows you to regain control of your debts and work towards debt freedom
Debts cannot increase further
Frozen interest and charges so that your debts do not increase.
Creditors cannot pursue you for their debt or take legal action.
Knowing when you'll be debt free
A fixed agreement usually lasting 5 years, after which any remaining unsecured debts will be written off.
Home is protected
An IVA can help safeguard your property and ensure future affordability even after the IVA.
You'll be less stressed knowing IVA will stop contact from your creditors and your payment are affordable
Avoidance of bankruptcy
An IVA enables you to continue to trade if you are self-employed or have a trading business.
Better able to afford other financial commitments
An IVA can catch unknown debts such as unpaid tax or overpaid tax credits.
Debt Solution Example
Savings possible from a typical IVA
Before: applicant currently pays £380/m towards debts, which are:
|Other includable debts||£6,000|
|Total Current Debts||£20,500|
|Further interest & charges while repaying these debts over several years could be say...||£4,000+|
|Cost to Clear Debts||£24,500+|
After: applicant can afford £130/m towards debts, then:-
|IVA payments||£130 * 60 months|
|Cost To Clear Debts||£7,800|
|*Payment levels depend on affordability of the individual applicant and are subject to creditor acceptance.|
Things you should know before deciding on an IVA.
Subject to eligibility and acceptance
Debt write off applies to included unsecured debts only and only on completion of an IVA. Debts not included remain outstanding. Not available in Scotland.
IVA can fail
If you break terms of your IVA and you don’t speak to your provider, it may fail. If this happens you must make other arrangements to repay your debts or potentially risk bankruptcy.
Restrictions on expenditure
There may be restrictions on your expenditure throughout the term of your IVA. You won't be expected to live in provety but neither can you be spending excessively while at the same time expecting creditors to be forgiving you a large part of your debts.
If you are a homeowner (and only in some cases) you may be required to re-mortgage in the 5th year of your IVA to release some equity to creditors. There are many situations where this is not required and the IVA is extended for 12 months instead.
An IVA appears on your credit file for 6 years. During this time it may be difficult to obtain credit.
Most peoeple entering an IVA already have a poor credit rating and the IVA is the first step on their path to recovery.
No guarantee of acceptance
Creditors can reject an IVA, usually for a specific reasons. We can renegotiate if required. We do not put forward an IVA without a reasonable expectation of approval.
An IVA will be recorded and entered onto a public register but someone would need to be specifically looking for you on it to find you.
Get Started Today
Give us 15 mins - We'll help get your life back on track
It is free to set up an IVA with Debt Guardians.
We do not charge any upfront fees for drafting and submitting your IVA Proposal. We only put an IVA case forward if we believe it will be a successful one for both you and your creditors. Even if your IVA proposal is unsuccessful, you will not be charged a penny.
The fees for an IVA are all set by the creditors, no matter which IVA provider you use.
All fees are taken out of your affordable monthly payment or from your agreed lump sum payment, so you will never be asked for additional fees or receive a bill from us. See More About IVA Fees.