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IVA Questions and Answers

The most important aspect of asking for help with a debt problem is being sure you are asking the right people to help you.

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Frequently Asked Questions (FAQs)

Here are a list of some of the most frequently asked questions we have received about an IVA. We have provided a brief answer with a link to an more in depth response if you wish to know more. Please feel free to call our helpline 0800 856 8569 at any time to have your IVA questions answered.

  1. What is an IVA
  2. Where do IVAs come from
  3. Must I open a new bank account for my IVA
  4. Who pays the IVA fees
  5. What debts can go into an IVA
  6. How much will the IVA payments be
  7. What will happen to my home in an IVA
  8. What will happen to my car in an IVA
  9. Can I still pay into my pension with an IVA
  10. Will my employer be told of my IVA
  11. Can I include a business loan in my IVA
  12. What if I have payment problems during my IVA
  1. Can my IVA include overpaid benefits
  2. Can an IVA include my unpaid Inland Revenue Tax bill
  3. Can I do an IVA if I receive Disability Living Allowance DLA
  4. How does an IVA affect credit rating
  5. Can I do an IVA if I am unemployed
  6. What Happens at the end of an IVA
  7. What is a Joint IVA
  8. What happens if my IVA fails
  9. What will happen to equity in my home
  10. What happens if I receive a Windfall during my IVA
  11. Will my creditors agree to my IVA
  12. How long does an IVA last

1What is an IVA.

An IVA is a formal debt solution that acts as an alternative to bankruptcy and allows a person with debts above £10,000 an opportunity to agree reduced payments with their creditors for a fixed term, which is normally 5 years.
Read more What is an IVA

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2Where do IVAs come from.

IVAs were introduced in 1986 as part of the Insolvency Act of England, Wales and Northern Ireland and have since become a powerful weapon in the fight against consumer debt problems.
Read more Where do IVAs come from

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3Must I open a new bank account for my IVA.

Yes, in most cases you will need to open a ‘Basic Bank Account’ as your old bank account will be included in the IVA’s list of creditors.
Read more Must I open a new bank account for my IVA

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4Who pays the IVA fees.

An IVA’s fees are drawn out of the IVA contributions. Therefore the creditors pay the fees of the IVA out of the money that has been repaid.
Read more Who pays the IVA fees

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5What debts can go into an IVA.

An IVA can only deal with unsecured debts, such as bank loans, credit cards, store cards and overdrafts.
Read more What debts can go into an IVA

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6How much will the IVA payments be.

Payments into an IVA are based on affordability for the applicant and will vary depending on the personal circumstances of each applicant.
Read more How much will the IVA payments be

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7What will happen to my home in an IVA.

An IVA protects your home and allows you to stop creditors from taking legal actions to make you sell it.
Read more What will happen to my home in an IVA

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8What will happen to my car in an IVA.

An IVA protects your motor vehicle of modest value. Your creditors forfeit the right to take legal action against you as a way of seizing your assets such as your car. Once the IVA is agreed, your car is safe.
Read more What will happen to my car in an IVA

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9Can I still pay into my pension with an IVA.

Yes, although your creditors may insist that your pension contributions are reduced to the minimum contribution levels.
Read more Can I still pay into my pension with an IVA

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10Will my employer be told of my IVA.

Your IVA is a private agreement between you and your creditors and your employer will not be notified, unless they are actually one of your creditors.
Read more Will my employer be told of my IVA

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11Can I include a business loan in my IVA.

Yes. If you are a sole trader and have an outstanding business loan, then it will included in your IVA, just the same as all your other unsecured debts.
Read more Can I include a business loan in my IVA

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12What if I have payment problems during my IVA.

If you experience payment problems during your IVA, your first response should be to contact your IVA Supervisor. Protocol compliant IVAs give your supervisor the discretion to provide you with assistance, to help protect the IVA from falling into arrears. There are primarily 2 options available to the supervisor should they agree your circumstances require assistance. They can provide a modest reduction to your IVA payments or they can provide a short-term payment break.
Read more Payment problems during my IVA

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13Can my IVA include overpaid benefits.

Yes. Your IVA can include overpaid benefits if they have been overpaid in error. What's more, if your benefits have been temporarily reduced, your benefits will be returned to the full level of income, helping you afford your IVA contributions more easily.
Read more Can my IVA include overpaid benefits

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14Can an IVA include my unpaid Inland Revenue Tax bill.

Yes. H.M. Revenue & Customs debts can be included into your IVA along with all your other unsecured debts and will be treated in just the same manner.
Read more Can an IVA include my unpaid Inland Revenue Tax bill

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15Can I do an IVA if I receive Disability Living Allowance DLA.

Yes. Receiving DLA does not preclude you from applying for an IVA as it is a living allowance and therefore not considered in the same way as state benefit.
Read more Can I do an IVA if I receive Disability Living Allowance DLA

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16How does an IVA affect credit rating.

An IVA will affect your credit rating for 6 years, beginning at the start date of the IVA. Your IVA will not impact on your partner's credit rating or other people you live with, so long as you do not have any 'shared', or joint accounts.
Read more How does an IVA affect credit rating

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17Can I do an IVA if I am unemployed.

Yes. Technically speaking, there's nothing to say that you can't enter an IVA if you are unemployed. However, we feel it would be inadvisable for you to enter into an IVA if your income is solely based on unemployment benefit. A household income which has partial reliance on unemployment benefit can be considered.
Read more Can I do an IVA if I am unemployed

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18What happens at the end of an IVA.

When your IVA successfully completes, any unpaid debts are legally written-off and you will be completely debt free. You will be give a certificate of completion to inform the credit reference agencies and your name will be removed from the insolvency register and you will once again be able to apply for credit.
Read more What happens at the end of an IVA

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19What is a Joint IVA.

Sometimes two people living at the same address whilst sharing financial resources, can propose a ‘Joint IVA’ to clear their shared and individual debts. These are also sometimes referred to as ‘Interlocking IVAs’.
Read more What is a Joint IVA

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20What happens if my IVA fails.

If an IVA is deemed to have failed, the client is no longer under the legal protection of the IVA and becomes responsible once again for arranging payments to their creditors.
Read more What happens if my IVA fails

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21What will happen to equity in my home.

Creditors will expect homeowners to agree to the release the equity in their home at some point within the IVA, however, this clause comes with certain conditions, designed to protect the IVA applicant from having to sell their property.
Read more What will happen to equity in my home

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22What happens if I receive a Windfall during my IVA.

A windfall will most often arrive in the shape of some good fortune, such as a Lottery win or a prize, but it can also come about as a result of misfortune too. Redundancy payments, an Inheritance or Insurance payouts are also classed as financial windfalls.
Read more What happens if I receive a Windfall during my IVA

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23Will my creditors agree to my IVA.

Creditors understand that a small proportion of their customers will fall on hard times and be unable to maintain their financial commitments. They make allowances for such events and have strategies in place to minimise their losses when this happens.
Read more Will my creditors agree to my IVA

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24How long does an IVA last.

In the vast majority of cases an IVA will last for 5 years, though this can vary depending on the individual circumstances of each case.
Read more How long does an IVA last

Call us now for free on 0800 856 8569 Apply for an IVA FAQ's

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