An Individual Voluntary Arrangement (IVA) is a legal agreement between you, any creditors with whom you have unsecured debts such as credit cards and loans, and a licensed insolvency practitioner.

With an IVA, you agree to pay a single, reduced, affordable amount each month for a period of 3 to 5 years, after which your creditors will write off any remaining debt. Ultimately, you may be able to write off as much as 90% of your debt by setting up an IVA.

The reason that creditors are normally willing to accept an IVA is that they don’t have to spend time and money pursuing debts that people aren’t able to repay. It takes between 6 and 8 weeks to set up an IVA, and once it is active, all interest charges are frozen and creditors will deal with your insolvency practitioner rather than contacting you directly.

In order to qualify for an IVA, there are a few basic conditions:

• IVAs are only available to individuals, not businesses.
• IVAs are only available to people who owe more than £15,000.
• IVAs are only available to people who are earning a regular income.
• IVAs are only available to people residing in England, Wales or Northern Ireland

If you live in Scotland, you may be eligible for a Trust Deed.

If you owe less than £15,000 but you are struggling to repay your debts, there are other options available to you – find out more about other debt management options.