The IVA Process

An IVA is a legal arrangement between you and your lenders. Although the legal side of things might sound daunting, we'll help you through the process to make sure it's as easy as possible for you.

Here's our step-by-step guide to exactly what the IVA process involves.

Step 1: Talk to us about your debts

Before you apply for an IVA, talk to us about your circumstances. This will help us to build a picture of your financial situation, and from this we can recommend the best way for you to get out of debt.

If we agree that an IVA is the right solution for you, we'll help you get started. If not, we'll help you find a solution that's better suited to your needs.

Step 2: The IVA proposal

An IVA proposal is a document that sets out your case for entering an IVA, as well as the proposed terms of the agreement. We will help you put together your IVA proposal, based on what you tell us about your circumstances. Then we'll send it on to your lenders.

Your lenders will be asked to vote for or against your IVA proposal. For the IVA to go ahead, you must receive approval from 75% of lenders (by debt value) who choose to vote. If this happens, even those who did not vote in favour will be included.

If you don't receive sufficient approval or your lenders want to change the terms put forward, we'll do our best to negotiate between you and your lenders. If they don't agree to anything, we'll recommend a suitable alternative debt solution.

Step 3: The IVA begins

On a typical IVA, you'll be making monthly payments to us, from which we'll distribute the agreed amount to each of your lenders. This will normally continue for five years, depending on the terms of your agreement.

Step 4: Equity release (doesn't apply if you're not a homeowner)

Homeowners who enter an IVA are usually required to release equity from their home, with the money raised going to the lenders involved. This normally takes place half way through the final year of the arrangement.

Of course, if you have little or no equity in your home, you won't be able to do this. If that's the case, it may be necessary to extend your IVA by another year to ensure your lenders receive more of the money owed to them.

Step 5: Your IVA completes

Once you have made the final agreed payment, your IVA will complete. At this point, any remaining unsecured debt you owe will be written off.

But remember: the effects of entering an IVA on your finances could continue after this point. A record of your IVA will remain on your credit history for six years, meaning that after a five-year IVA you could still find it difficult to obtain credit for at least another year.

Looking for help with your debts? Call our expert advisers on 0800 195 2911 and we'll see what we can do to help.

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