Individual Voluntary Arrangement (IVA) in the UK — The 2025 Deep-Dive You Can Actually Use

If you’ve searched for Individual Voluntary Arrangement because letters and calls are piling up, breathe—you have calm, practical options. At Fresh Start Debt Support we help real people decide whether an Individual Voluntary Arrangement suits their income, priorities and goals—or whether a Debt Management Plan (DMP) or a Debt Relief Order (DRO) would be safer. We protect essentials like council tax, energy/utilities and housing costs, reduce pressure using Breathing Space where appropriate, and—if suitable—set up an Individual Voluntary Arrangement that gives you one affordable monthly payment you can keep.

This long-form page explains an Individual Voluntary Arrangement in plain English: what it is, how it’s approved, what it costs, how creditors vote, what happens with your car or home, how your credit file is affected, and what life looks like during and after the Individual Voluntary Arrangement. We’ll also link to simple tools like our Debt Calculator and clear guides such as Compare Solutions, What is debt collection? and Stop Debt Collectors. Prefer a short overview page? See our dedicated Individual Voluntary Arrangement (IVA) explainer.

What Is an Individual Voluntary Arrangement?

An Individual Voluntary Arrangement is a formal, legally binding agreement with your unsecured creditors. You pay what’s affordable for a fixed term and, on successful completion of the Individual Voluntary Arrangement, the remaining eligible unsecured balances are usually written off. Because an Individual Voluntary Arrangement is formal, most creditor action stops once it’s approved.

How an Individual Voluntary Arrangement works day-to-day

• One realistic monthly payment based on a defendable budget created for the Individual Voluntary Arrangement.
• Communication funnels through the Insolvency Practitioner (IP) supervising your Individual Voluntary Arrangement.
• Interest/charges on included debts typically stop after your Individual Voluntary Arrangement is approved.
• At the end of the Individual Voluntary Arrangement, remaining eligible unsecured debt is written off.

Who sets up the Individual Voluntary Arrangement?

An Insolvency Practitioner proposes and manages your Individual Voluntary Arrangement. We explain their role, how they’re paid within the Individual Voluntary Arrangement, and what you can expect at reviews and variations. For a concise overview, visit iva.

Do I Qualify for an Individual Voluntary Arrangement?

You may qualify for an Individual Voluntary Arrangement if you have multiple unsecured debts, a steady (or reasonably predictable) income, and can commit to an affordable monthly amount after essentials. The suitability of an Individual Voluntary Arrangement depends on your creditor mix, household budget and assets.

Strong signs an Individual Voluntary Arrangement might fit

• Repaying in full would take many years; an Individual Voluntary Arrangement gives a structured end date.
• You need protection from most legal/enforcement action once the Individual Voluntary Arrangement is approved.
• You can sustain a fixed payment or access a lump sum for a settlement-style Individual Voluntary Arrangement.

If an Individual Voluntary Arrangement is not right

We’ll say so—clearly. We’ll compare IVA (Individual Voluntary Arrangement) with DMP and DRO using your numbers so you can choose confidently.

Pros & Cons of an Individual Voluntary Arrangement

Benefits of choosing an Individual Voluntary Arrangement

• Legal protection: After approval, an Individual Voluntary Arrangement generally stops most legal action.
• One payment: An Individual Voluntary Arrangement consolidates many debts into a single affordable figure.
• Write-off: On completion, an Individual Voluntary Arrangement can write off eligible remaining balances.
• Structure: An Individual Voluntary Arrangement gives a clear schedule and endpoint.

Limitations to consider before an Individual Voluntary Arrangement

• Credit file impact: an Individual Voluntary Arrangement is recorded for six years from approval.
• Affordability matters: an Individual Voluntary Arrangement can fail if payments stop without a variation.
• Assets: home equity may be reviewed during the Individual Voluntary Arrangement.

Bottom line

Matched correctly, an Individual Voluntary Arrangement is powerful. If your situation calls for flexibility instead, a Debt Management Plan may be better—compare options on Compare Solutions or see iva.

What Does an Individual Voluntary Arrangement Cost?

Fees for an Individual Voluntary Arrangement are usually built into your monthly payment; you don’t typically pay them upfront. Your proposal shows clearly what goes to creditors and what covers administration of the Individual Voluntary Arrangement. If anything is unclear, we’ll translate the jargon.

Clarity before you sign an Individual Voluntary Arrangement

We present a simple breakdown so you understand every pound inside the Individual Voluntary Arrangement—no surprises, no pressure.

Related reading

Want a quick overview of how providers charge? See IVA Company then jump back to iva for the essentials.

How to Apply for an Individual Voluntary Arrangement

Step-by-step Individual Voluntary Arrangement process

1. Fact-find: We list debts, income and essentials to test an Individual Voluntary Arrangement.
2. Budget: Use our Debt Calculator to build a defendable Individual Voluntary Arrangement budget.
3. Proposal: The Insolvency Practitioner drafts your Individual Voluntary Arrangement proposal.
4. Creditor vote: Creditors vote to approve the Individual Voluntary Arrangement; we explain thresholds and modifications.
5. Supervision: After approval, reviews/variations keep your Individual Voluntary Arrangement on track.

Timing & breathing space

Where appropriate, Breathing Space can ease pressure while your Individual Voluntary Arrangement is prepared. Read more on iva.

What Debts Can an Individual Voluntary Arrangement Cover?

An Individual Voluntary Arrangement typically includes unsecured debts such as loans, credit cards, catalogues/BNPL, overdrafts and some arrears. Priorities like council tax and energy must be stabilised alongside the Individual Voluntary Arrangement so your household stays safe while the plan progresses.

Co-ordinating priorities with your Individual Voluntary Arrangement

We’ll protect rent/mortgage, utilities and travel first, then shape the Individual Voluntary Arrangement around a budget that matches real life—not a perfect month.

Business owners & directors

If self-employed, we’ll align your Individual Voluntary Arrangement with trading cycles (see Business Debt), so VAT/tax and tools of the trade are sensibly managed.

Self-Employed, Variable or Zero-Hours? Build a Flexible Individual Voluntary Arrangement

Income volatility is normal now. A good Individual Voluntary Arrangement leaves headroom so a quiet week doesn’t collapse your month. We’ll average income sensibly, include seasonal changes, and design the Individual Voluntary Arrangement to survive real life.

What we’ll review for your Individual Voluntary Arrangement

• Average post-tax income and predictable cycles for the Individual Voluntary Arrangement.
• Essential tools/vehicle and how they’re treated within the Individual Voluntary Arrangement.
• Contingency for slow periods so the Individual Voluntary Arrangement doesn’t snap.

Helpful comparison

Sometimes a DMP is a better stabiliser before an Individual Voluntary Arrangement. We’ll map it out, then revisit iva if/when timing improves.

Home, Car & Assets During an Individual Voluntary Arrangement

Every Individual Voluntary Arrangement looks at assets differently. Homeowners may have an equity review later in the Individual Voluntary Arrangement. Vehicles required for work are typically considered sensibly. We’ll explain the likely approach in your Individual Voluntary Arrangement before you commit.

Protecting essentials while in an Individual Voluntary Arrangement

We stabilise housing and energy first, then build the Individual Voluntary Arrangement around those essentials so day-to-day life stays workable.

Next step

Tell us about your home, car and tools—we’ll outline how a potential Individual Voluntary Arrangement could treat them. You can also view the headline points on iva.

Credit Files & Life After an Individual Voluntary Arrangement

An Individual Voluntary Arrangement is shown on your credit file for six years from approval. Many people still choose an Individual Voluntary Arrangement because it replaces chaos with control and a clear path out. After your Individual Voluntary Arrangement completes, you can rebuild using on-time payments, sensible utilisation, and a simple budget.

Rebuild basics after an Individual Voluntary Arrangement

• Maintain essential bills throughout the Individual Voluntary Arrangement.
• Keep a small emergency buffer so the Individual Voluntary Arrangement stays on track.
• Review progress yearly; celebrate milestones within the Individual Voluntary Arrangement.

Helpful extras

Short on bandwidth? Our guides Affordable Repayment Plans and Clear Debt Fast show simple habits that complement an Individual Voluntary Arrangement.

Breathing Space While You Prepare an Individual Voluntary Arrangement

When timing is delicate, Breathing Space can provide a legal pause while your Individual Voluntary Arrangement is being prepared. It won’t suit every case, but used well it reduces noise so the Individual Voluntary Arrangement can be built calmly and correctly.

When Breathing Space helps an Individual Voluntary Arrangement

• Multiple collectors contacting you as you prepare your Individual Voluntary Arrangement.
• Council tax or PCN enforcement while the Individual Voluntary Arrangement is proposed.
• You need quiet time to finalise the Individual Voluntary Arrangement budget.

Read next

See Breathing Space basics, then skim iva for the quick IVA overview.

Individual Voluntary Arrangement vs DMP vs DRO

There’s no single “best” solution—only the one that fits your life. An Individual Voluntary Arrangement offers formal protection and a fixed end date; a DMP offers flexibility; a DRO can work for low income/low assets. We’ll compare them side-by-side so you can choose between an Individual Voluntary Arrangement and alternatives with confidence.

Quick comparison pointers

• Protection: Strongest with an Individual Voluntary Arrangement once approved.
• Flexibility: Highest in a DMP; moderate via variations in an Individual Voluntary Arrangement.
• Eligibility: Tightest for a DRO; broader for an Individual Voluntary Arrangement.

Next step

Use Compare Solutions, then return to iva or continue below if an Individual Voluntary Arrangement still looks right.

Dealing with Collectors & Enforcement During an Individual Voluntary Arrangement

Collectors are not bailiffs. Move to written contact while you assess an Individual Voluntary Arrangement. If you’re facing local authority enforcement (council tax/PCNs), timing matters—another reason to position an Individual Voluntary Arrangement or Breathing Space quickly.

Useful scripts while preparing an Individual Voluntary Arrangement

See Stop Debt Collectors and What is debt collection? for wording that buys you time to finalise your Individual Voluntary Arrangement budget without pressure.

Extra support

Need to prioritise? Our Council Tax Debt and Energy/Utilities pages fit neatly alongside an Individual Voluntary Arrangement.

The Individual Voluntary Arrangement Action Plan (10 Practical Steps)

Follow this to build a defendable Individual Voluntary Arrangement

1. Gather letters/cards; photograph envelopes for your Individual Voluntary Arrangement file.
2. Stabilise priorities (rent/mortgage, energy, council tax) before the Individual Voluntary Arrangement.
3. Draft a budget via the Debt Calculator for the Individual Voluntary Arrangement.
4. Switch to written contact while you prepare the Individual Voluntary Arrangement.
5. Consider Breathing Space to protect time for your Individual Voluntary Arrangement.
6. Avoid agreeing to payments that could break your Individual Voluntary Arrangement next month.
7. Choose between IVA, DMP and DRO.
8. Roll other debts into the Individual Voluntary Arrangement where suitable.
9. Keep a simple log; it supports your Individual Voluntary Arrangement if anything needs challenging.
10. Review regularly; vary your Individual Voluntary Arrangement if income changes.

Need templates?

Jump to scripts below, or skim iva for a compact IVA overview.

Templates & Scripts While You Consider an Individual Voluntary Arrangement

Switch to written contact

“I’m seeking debt support and assessing an Individual Voluntary Arrangement. Please confirm the balance and reference in writing. I’ll send an affordable proposal once my budget is complete. I prefer written contact.”

Ask for details

“Please provide a statement showing how the balance was calculated and the original creditor and account reference. I am preparing an Individual Voluntary Arrangement and need accurate figures.”

Vulnerability note

“Due to my circumstances I may be vulnerable. Please confirm reasonable communication adjustments in writing while I finalise my Individual Voluntary Arrangement budget.”

Individual Voluntary Arrangement: Myths vs Facts

Myth: “I must pay something today or I’ll be in more trouble.”

Fact: A rushed token payment that breaks next month can undermine your Individual Voluntary Arrangement planning. Build a defendable budget first.

Myth: “Collectors can come in and take my things.”

Fact: Collectors are not bailiffs. Move to written contact while you prepare your Individual Voluntary Arrangement.

Myth: “An Individual Voluntary Arrangement means I’ll lose my car or home.”

Fact: Treatment of assets in an Individual Voluntary Arrangement is case-specific. We’ll explain likely outcomes before you proceed.

Want a quick myth-buster?

Skim our dedicated Individual Voluntary Arrangement page and come back for the full detail here.

Frequently Asked Questions — Individual Voluntary Arrangement (IVA)

Will an Individual Voluntary Arrangement stop interest and charges?

If your Individual Voluntary Arrangement is approved, interest and charges on included debts typically stop. We’ll confirm how this applies to your creditor list.

How long does an Individual Voluntary Arrangement last?

Most Individual Voluntary Arrangement terms run around five to six years. Lump-sum Individual Voluntary Arrangement settlements can be shorter.

Will an Individual Voluntary Arrangement affect my credit file?

Yes. An Individual Voluntary Arrangement appears for six years from approval. Many people still choose an Individual Voluntary Arrangement because it provides structure and a finish line.

Can I include council tax or PCNs in an Individual Voluntary Arrangement?

Your Individual Voluntary Arrangement will coordinate alongside council tax and enforcement on PCNs—timing and treatment are important. We’ll prioritise essentials, then finalise the Individual Voluntary Arrangement.

What if my income changes during an Individual Voluntary Arrangement?

We can explore a variation so your Individual Voluntary Arrangement stays realistic. Keep us updated early.

Is an Individual Voluntary Arrangement right if I’m self-employed?

Often, yes—if the Individual Voluntary Arrangement budget includes seasonal and cash-flow variability. We’ll average income and build headroom.

Do I have to speak to creditors by phone during an Individual Voluntary Arrangement?

No. Written contact (email/letter) is clearer while you prepare and run your Individual Voluntary Arrangement.

Where can I get a concise overview?

See our short Individual Voluntary Arrangement (IVA) guide, then return here for in-depth steps.

Case-Style Walk-Through: From First Letter to Individual Voluntary Arrangement Stability

Day 1–2: You collect letters, take photos, and log dates. You switch to written contact while assessing an Individual Voluntary Arrangement.

Day 2–4: You complete the quick form. We fact-find and protect priorities (council tax, energy, housing) as we weigh an Individual Voluntary Arrangement vs alternatives.

Day 5–7: We build a realistic budget with the Debt Calculator. Where appropriate, we use Breathing Space while the Individual Voluntary Arrangement proposal is drafted.

Week 2: The Individual Voluntary Arrangement proposal is finalised and issued for creditor vote; we handle questions and modifications.

Week 3+: If approved, you make one affordable payment under the Individual Voluntary Arrangement. Reviews keep it on track; variations exist if income shifts.

Ready to Start? The Shortcut to Your Individual Voluntary Arrangement

1. Scan the essentials on iva or Compare Solutions.
2. Complete the quick form to explore an Individual Voluntary Arrangement.
3. Talk or WhatsApp—whatever’s easier while we assess your Individual Voluntary Arrangement.
4. List every debt; we help with a free credit check if needed for the Individual Voluntary Arrangement.
5. Agree an affordable monthly figure for the Individual Voluntary Arrangement.
6. Choose the route: IVA, DMP or DRO.
7. Use our reference and, where suitable, Breathing Space while we set up the Individual Voluntary Arrangement.

Our aim is simple: protect essentials, reduce stress, and move every creditor into a plan you can sleep on—often an Individual Voluntary Arrangement if it truly fits.

More Helpful Reads While You Weigh an Individual Voluntary Arrangement

• Individual Voluntary Arrangement (IVA)
• Affordable Repayment Plans
• Clear Debt Fast
• IVA Company
• DMP Provider
• Debt Help UK 2025
• Blog
• Privacy Policy

When you’re ready, we’re ready—on your terms and timeline. If an Individual Voluntary Arrangement is right, we’ll help you start; if not, we’ll point you to a better route.