Guides › Debt and Buy Now Pay Later › Individual Voluntary Arrangement (IVA): How It Works
Individual Voluntary Arrangement (IVA): How It Works
An IVA is a legally binding deal with your creditors to repay what you can afford, set up by an insolvency practitioner. It starts if creditors owed 75% of your debts agree, and then binds all of them. It usually lasts five or six years, and any balance left at the end may be written off. There are usually fees, so check the full cost first.
At A Glance
Your Rights
What the rules say, with a link to the official source for each.
How It Works
Setting Up
An insolvency practitioner works out what you can afford, contacts your creditors and handles your payments. source
Approval
It starts if creditors holding 75% of your debts agree, and applies to all creditors, even those who objected. Creditors cannot take action on those debts. source
Length
Usually five or six years. Any balance left may be written off. source
Costs and Risks
Fees and Missed Payments
There is usually a set-up fee and a handling fee. If you miss payments the IVA can be cancelled and you can be made bankrupt. It is on the Individual Insolvency Register until 3 months after it ends. source
Time Limits to Know
Miss a deadline and you can lose a right. Check the dates on your own paperwork.
- 5 to 6 yearsTypical IVAPayments every month
Steps to Take
Step 1 of 4
Get free debt advice before you agree to anything.
Step 2 of 4
Ask the insolvency practitioner for the total fees in writing.
Step 3 of 4
Make sure the payment is affordable for the whole term.
Step 4 of 4
Tell the practitioner straight away if your income changes.
(Tap the numbers to reveal steps)
Where to Go If It Is Not Put Right
Your options, in order, and when each one applies.
Free Debt Advice (MoneyHelper)
Find free, confidential debt advice near you or online.
Citizens Advice or National Debtline
Free debt advice. They can also ask bailiffs for more time on your behalf.
Good to Know
Small things that make your complaint stronger.
Be wary of firms advertising IVAs as a government scheme to write off debt.
These rules are for England and Wales. Scotland and Northern Ireland have different debt and enforcement rules.
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Lead reviewer
Luke Marley
Founder and Lead Reviewer
Luke founded CPUK in 2026 after seeing how hard it is for ordinary people to get problems with companies put right. He oversees our guides and checks them against official sources.
Research by Katie Burt, Co-founder and Operations Lead (17 years in the care sector, including managing services for vulnerable adults), and the CPUK Research Team. Researched with AI-assisted research tools, then checked and corrected by our team.
Last checked: 15 October 2026. We are not paid by the companies we write about. Adverts never affect our guidance. Read our editorial policy.
Sources and official links
- gov.uk/options-for-paying-off-your-debts/individual-voluntary-arrangements Checked 15 October 2026
- moneyhelper.org.uk/en/money-troubles/dealing-with-debt/options-for-clearing-your-debts-england-and-wales Checked 15 October 2026