How much of my debt is written off?

It depends on what you can afford. On average, IVAs write off between 25% and 75% of the original debt, but every case is different.

Will my employer find out?

Employers aren't automatically told. A small number of professions (e.g. certain financial roles) may have restrictions — an adviser will check this with you.

Can I still have a bank account?

Yes. You'll usually need a basic bank account without an overdraft or a bank you don't already owe money to.

What happens if my circumstances change?

IVAs are reviewed annually and can often be varied. If you can't continue, your Insolvency Practitioner will discuss options with your creditors.

Debt solution

Individual Voluntary Arrangement (IVA)

An IVA is a legally binding agreement to pay back what you can afford, usually over five or six years. Any remaining unsecured debt is written off at the end.

Get Free Debt Help Calculate Your Debt Solution

FormalEngland, Wales & Northern Ireland

Overview

An Individual Voluntary Arrangement (IVA) is a formal insolvency solution set up by a licensed Insolvency Practitioner. It protects you from creditor action and gives you a clear end date.

You agree a monthly payment based on what you can genuinely afford after essentials. Interest and charges are frozen and, once the arrangement completes, any unsecured debt still remaining is legally written off.

IVAs are serious commitments and stay on your credit file for six years — but for many people they offer a structured, dignified route out of unmanageable debt without the wider impact of bankruptcy.

Who it's suitable for

You owe more than around £6,000 across two or more creditors
You have a regular income and can commit to a fixed monthly payment
You want protection from creditor action and legal certainty
You'd like to protect assets (like a home) that bankruptcy could put at risk

Advantages

Legally binding — creditors can't chase you or add interest
One affordable monthly payment for a fixed period
Remaining unsecured debt written off at the end
Usually protects your home if you have limited equity
Doesn't affect most types of employment

Disadvantages

Recorded on your credit file for six years
Listed on the public Individual Insolvency Register
Fees apply (paid from your monthly contributions)
Homeowners may need to remortgage to release equity in year 5
Failing an IVA can lead to bankruptcy

Eligibility

General criteria — an adviser will confirm what applies to your circumstances.

You have unsecured debts you can't reasonably repay in full
You have surplus income after essential living costs
You live in England, Wales or Northern Ireland (Scotland has Trust Deeds)
You're prepared to have your budget reviewed annually

Example

Daniel, 47 — Cardiff

Daniel owed £32,000 across credit cards, a loan and a business overdraft. He earns a steady wage but couldn't cover contractual payments after his mortgage and family costs.

Outcome: A 60-month IVA was proposed at £220 per month. Creditors accepted. Interest was frozen from day one, and after five years the remaining balance — around £18,800 — was written off.

Illustrative only. Names and figures are examples, not real customers.

How it compares

A quick side-by-side of the main UK debt solutions.

Solution	Region	Duration	Debt written off?	Credit impact	Type
Debt Management Plan	UK-wide	Flexible	No	Moderate	Informal
IVA	Eng, Wal, NI	5–6 years	Yes (remainder)	6 years	Formal
Debt Relief Order	Eng, Wal, NI	12 months	Yes (after 12m)	6 years	Formal
Bankruptcy	UK-wide	~12 months	Yes	6 years	Formal
Breathing Space	Eng, Wal	60 days	No	Low	Temporary
Token Payments	UK-wide	Short-term	No	Moderate	Informal
Full & Final Settlement	UK-wide	One-off	Partial	Moderate–High	Informal

Frequently asked questions

Not sure where to start? We'll walk you through it.

A quick, confidential chat with a friendly advisor. No pressure, no jargon — just a clear picture of the options that suit your situation.

Get Free Debt Help Calculate Your Solution