Individual voluntary arrangement (IVA)

An individual voluntary arrangement (IVA) is a formal agreement to repay your creditors at an amount you can afford.

This can be a one-off payment known as a lump sum IVA or over a longer period to spread payments which usually lasts five or six years. You make one affordable payment to us each month and we distribute it fairly among your creditors. During your IVA creditors should not contact you or increase your debt.

When the final payment is made, any remaining debt is written off.

A Individual Voluntary Arrangement (IVA) is only available in England, Wales and Northern Ireland.

Watch: An introduction to IVAs

IVA benefits

  • You make affordable monthly payments, usually over five or six years.
  • If you have a lump sum to offer, this can be paid as a one-off ‘full and final’ settlement, or a combination of a lump sum payment followed by monthly payments.
  • Once you’ve made your final payment any remaining debt is written off.
  • Your creditors can't pursue you for your debts, and will usually stop contacting you shortly after your IVA is approved.
  • If you’re a homeowner, you’ll usually be able to keep your home, provided you maintain the mortgage payments and any other loans secured on your property.


  • Your IVA will be recorded in a public register.
  • Your credit rating will be affected.
  • If there’s equity in your home then you’ll need to try to re-mortgage. If you are unable to re-mortgage you can make a maximum of 12 extra payments or a 3rd party can offer a sum equivalent to the equity. Please be aware that remortgaging may result in a higher interest rate.

Other issues to consider while on an IVA

Before you enter into an IVA, there are some things that you should take into consideration first:

  • Should the IVA fail, creditors may request that the Supervisor looking after your IVA petitions for your bankruptcy but this is unlikely.
  • Once your IVA is set up, your spending will be restricted until the IVA comes to an end.
  • Should your circumstances change during the term of your IVA, you may ask creditors to review the terms you originally agreed to. During your IVA you'll receive an annual review and If your situation has improved, you may have to increase your payment.
  • At the end of an arrangement, only debts included in the arrangement will be discharged.
  • Any debts that can’t be included will still be left to pay, for example any money owed under family court proceedings, any court fines or debts arising from fraud, debts incurred after the IVA, or student loans.
  • We do not charge you for the advice and support we provide before your IVA is set up. There are fees involved in running your IVA. Our fees follow the industry standard for IVAs and are set by your creditors. You must agree to the level of fees before your IVA is approved.  We will deduct these fees from your monthly payment, so you don’t have to pay any additional costs.

  • If you are recommended an IVA and you’re self-employed or live in Northern Ireland, you'll be referred to a trusted insolvency practitioner who will set up and administer your IVA.
  • If you're a homeowner you will be asked to re-mortgage your property towards the end of the IVA. You could however offer a 3rd party sum equivalent to the equity as an alternative.


Is an IVA suitable for me?

An IVA may be suitable if you can afford to pay something to your debts, but not the full amount your creditors want. If you have a lump sum to pay towards your debts, you may also qualify for an IVA.

You can only apply for an IVA if you live in England, Wales or Northern Ireland. If you live in Scotland read our debt advice in Scotland page for more information on the solutions available to you.

How does an IVA work?

An IVA is managed by an insolvency practitioner (IP), who can help you draw up a repayment proposal to send to your creditors. At StepChange Debt Charity we have our own IVA company – StepChange Voluntary Arrangements, with two licensed IPs who’ll be able to help you draw up your proposal to suit your personal circumstances.

Your IP will arrange a meeting of your creditors, where your creditors will decide whether to accept or reject your proposals. If your IVA is accepted it becomes legally binding. As long as you keep to the terms of your IVA, none of your unsecured creditors (even those who didn’t vote or who voted against the IVA) will be able to pursue you for any debt incurred prior to approval of the IVA. An IVA is a form of insolvency so it’s important that you get expert, impartial advice before entering into one.

How much are IVA fees?

There are always fees involved when you set up an IVA. The fees that you’ll need to pay are the nominee fee which is the fee that covers the cost of setting up your IVA. The Supervisor fee is for the administration of the IVA and there are disbursement fees which are costs that we pay out to a third party during the IVA.

At StepChange Voluntary Arrangements our fees are set at the industry standard and we’ll make sure you’re fully aware of what we’re charging. The fees are paid out from monthly contributions (or from proceeds of a sale of assets), so there is never anything to pay up front.

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Why choose us?

We are the UK’s leading debt management charity with an award winning IVA company.

  • No upfront fees

The costs involved in running your IVA will be taken from your monthly payment. We do not charge for advice.

  • Expert advisors

Our expert advisors will be on hand to offer help and advice throughout your IVA.

What next? How to apply for an IVA.
  1. The first step is to see whether an IVA is right for you. Either call our free helpline to talk to one of our expert debt advisors, or use Debt Remedy, our free, anonymous online advice tool.
  2. If you wish to proceed with an IVA our specialist company, StepChange Voluntary Arrangements, can help you through this process. We’ll review your finances and help you put forward the IVA proposal to your creditors.
  3. Because our IVA recommendations are realistic, 98% of proposals put forward by StepChange Voluntary Arrangements are accepted by creditors* (please be aware that in rare circumstances, a lender may not approve an agreement).
  4. There are no set-up fees to be paid in advance of your IVA being agreed. You will have to pay fees once your IVA is in progress, but these will be paid as part of the monthly repayments towards your debt.

*Source: StepChange VA overall approval stats to end of Feb 2015

Clare Lindley of StepChange Voluntary Arrangements is licensed to act as an insolvency practitioner in the UK by the Insolvency Practitioners Association.