Thinking about an IVA?

Thinking about an IVA?
Speak to us first

If you’ve been advised to take out an Individual Voluntary Arrangement (IVA), it’s important to get independent advice before you commit.

An IVA can be the right solution for some people — but it is not suitable for everyone, and once you sign up it can be difficult to change course.

At Harpenden Money Advice Centre, we offer free, confidential, FCA-regulated advice and look at all your options before recommending any solution.

What is an IVA?

An Individual Voluntary Arrangement (IVA) is a formal agreement to repay your debts, usually over five or six years, using surplus income. It is set up by a licensed Insolvency Practitioner and is legally binding.

During an IVA:

  • You make regular monthly payments

  • Your budget is reviewed each year

  • You must report changes in income or circumstances

  • The arrangement is recorded on your credit file

 

Why it’s important to be cautious

Many IVAs are arranged by commercial firms who advertise heavily and may present an IVA as the best — or only — solution.

From our experience, there are some important things people are not always told clearly at the outset.

Things to be aware of:

  • High fees: A significant portion of your early payments can go towards fees and commission rather than reducing your debts

  • Risk of failure: IVAs often fail if your circumstances change (for example, illness, job loss, or rising living costs)

  • Long commitment: You are usually committing to fixed payments for several years

  • If an IVA fails: You may still owe the debts and could face other options such as bankruptcy

  • Credit impact: An IVA remains on your credit file for six years

We regularly see clients who come to us after an IVA has failed, having made payments for some time but with little reduction in their overall debt.

There may be other options

For many people, a Debt Relief Order (DRO) or a Debt Management Plan (DMP) is a more suitable, flexible, and less risky option.

At Harpenden Money Advice Centre

  • We look at your whole financial situation

  • We explain all available options, including the advantages and disadvantages of each

  • We do not earn commission or charge fees

  • We will only suggest an IVA if it is genuinely the right solution for you

Harpenden Money Advice Centre is a local charity. Our advice is:

  • Free

  • Confidential

  • Impartial

  • Regulated by the Financial Conduct Authority

Before committing to an IVA, we strongly encourage you to speak to us. Even one conversation can help you feel clearer and more confident about your decision.

Contact us