The IVA process explained

An Individual Voluntary Arrangement (or IVA) is a formal bankruptcy alternative for residents of the United Kingdom. They first began in 1986 when they were established as Part VIII of the Insolvency Act of 1986. They constitute a formal repayment proposal to a creditor by your Insolvency Practitioner (IP). Typically an IVA can compromise the claims of an unsecured creditor which would then leave the rights unchanged for the most part. This is not often the case but it does happen. Individual Voluntary Arrangements are contractual agreements but are often flexible depending on certain personal circumstances but be warned, they do come with a risk. Usually the amount you pay back can be significantly less than you would normally have to pay back. When the IP is setting up your IVA they will look at a number of factors including income, third party payments, and capital. Explaining the IVA process isn’t easy but there are a few good sites on the internet – the government debt sites also have a number of resources that can help you.