What’s the difference between an IVA, DMP, DRO, Bankruptcy and Trust Deed?

IVA and Trust Deed are formal, legally binding plans that usually freeze interest and can write off remaining qualifying unsecured debt after completion. A DMP is informal and relies on creditor agreement to freeze interest. A DRO is for low income/low assets; qualifying debts can be written off after 12 months. Bankruptcy provides the quickest reset but may impact assets and has restrictions.

Who is eligible for an IVA?

Typically people with around £6,000+ of unsecured debt, multiple creditors and a steady income. Affordability and assets are assessed by a licensed Insolvency Practitioner.

How long does each solution last?

Typical terms: IVA 5–6 years, Trust Deed ~4 years (Scotland), DRO 12 months, Bankruptcy 1 year to discharge, DMP varies by affordability.

Will these solutions affect my credit file?

Yes. Formal solutions are usually recorded for six years (bankruptcy from discharge). Many people rebuild credit over time after completion.

What debts can I include?

Most unsecured debts such as credit cards, loans, overdrafts, catalogues and BNPL can be included. Secured debts, child maintenance and certain fines are generally excluded.

Can I switch solutions later?

Yes, if circumstances change. Get advice first to avoid unintended consequences.

IVA vs DMP — which is better?

Choose an IVA if you have higher unsecured debts, need legal protection and want remaining qualifying debt written off after completion. Choose a DMP if you need flexibility and an informal plan; interest freezes depend on creditor agreement and there’s no automatic write-off.

IVA vs DRO — which fits my situation?

A DRO can be best if you meet strict low income/low asset criteria; qualifying debts can be written off after 12 months. If you don’t meet DRO criteria but have steady income and need legal protection, an IVA may be suitable.

Compare UK Debt Solutions — IVA, DMP, DRO, Bankruptcy & Trust Deed

Q: Do I pay fees upfront?

For IVAs and Trust Deeds, fees are set out in your proposal and usually taken from your affordable monthly payments once approved. A DRO has a government process; bankruptcy has application/court fees. DMP provider fees vary (many charities charge no fees).

Q: IVA vs Bankruptcy — what’s safer?

Bankruptcy is the fastest reset but can affect assets and comes with restrictions. An IVA can help protect assets if you can afford monthly contributions and need a legally binding plan that usually freezes interest and enforcement.

Quick answer: The right solution depends on your debts, income and assets. Formal options like an IVA or Trust Deed usually freeze interest and stop most enforcement. A DRO can write off debts after 12 months if you meet strict criteria. DMPs are flexible but informal. Bankruptcy is the fastest reset but impacts assets and restrictions.

Independent guidance from MoneyHelper and charity resources like StepChange can help you weigh options alongside our free assessment.

Why Compare Debt Solutions Before Choosing

Comparing first helps you balance affordability, legal protection, what gets included, and how fast you could become debt-free — so you avoid switching later. (External guides highlight the trade-offs between formal vs informal routes.)

✅ Find what’s affordable for your budget
✅ Understand legal protections and risks
✅ See which debts can be included or excluded
✅ Know the impact on your credit file
✅ Learn typical timeframes to become debt-free

IVA vs DMP — What’s the Difference?

If you’re deciding between an IVA vs DMP, it usually comes down to how much you owe and whether you need legal protection. IVAs are legally binding, typically freeze interest/enforcement and can write off qualifying balances at completion; DMPs are flexible and informal but rely on creditor agreement for interest freezes.

When an IVA suits better

Higher unsecured debts (~£6k+), steady income, and you want certainty on interest/enforcement being stopped. Remaining qualifying debt can be written off after completion.

When a DMP suits better

Variable income or temporary difficulties where flexibility matters; no automatic write-off and freezes depend on creditor consent.

Is an IVA cheaper than a DMP?

IVA fees are built into approved contributions; many DMPs via charities are fee-free — but interest may continue unless creditors agree.

IVA vs DRO — Which Is Best?

Comparing IVA vs DRO hinges on income, assets and total debt. If you meet strict low income/low asset criteria, a DRO can be the quickest, lowest-cost reset with write-off after 12 months; otherwise, an IVA offers legal protection and a structured route to write-off at completion.

Do I pay fees upfront?

IVA fees are usually taken from contributions after approval. MoneyHelper outlines the DRO process and criteria.

IVA vs Bankruptcy — What Should I Choose?

Choosing between IVA vs Bankruptcy depends on asset risk and how fast you need a reset. Bankruptcy tends to be the quickest (about a year to discharge) but can affect assets and has restrictions; an IVA can help protect assets if you can afford monthly contributions.

Will either option wreck my credit?

Both affect your credit for roughly six years (bankruptcy from discharge). Many people rebuild after completion/discharge with careful budgeting.

Costs & Fees — What to Expect

How fees typically work

IVA / Trust Deed: Nominee & supervisory fees set out in the proposal and taken from affordable monthly payments once approved.
DRO: Government-administered process for low income/low assets (see latest criteria on MoneyHelper).
Bankruptcy: Application/court fees; consider impacts on assets and surplus income.
DMP: Many charity DMPs are fee-free; interest freezes are not guaranteed.

Exact amounts and processes can change — we’ll check the latest during your free assessment.

Eligibility at a Glance

Each route has criteria. General themes:

IVA: Usually £6k+ unsecured debt, multiple creditors, steady income (assessed by a licensed Insolvency Practitioner).
DMP: Flexible if you can pay something but need it reduced; informal and adjustable.
DRO: Low income/low assets within set limits; qualifying debts can be written off after 12 months if circumstances don’t improve.
Bankruptcy: For debts you can’t realistically repay; fastest full reset with restrictions.
Trust Deed: Scotland only; similar to an IVA with its own thresholds.

Legal Protections & Impact on Your Credit File

IVAs/Trust Deeds/Bankruptcy are formal, legally binding solutions that usually stop most enforcement; a DRO adds a legal moratorium for 12 months. Marks typically remain around six years (bankruptcy from discharge). DMPs are informal so creditor action can resume.

If you’re worried about urgent pressure, also read Breathing Space for short-term protection while you choose.

How Long Do They Last?

IVA: 5–6 years (sometimes +12 months instead of equity release).
DMP: Varies by debt size and affordable payment.
DRO: Usually 12 months to write-off if circumstances fit.
Bankruptcy: ~1 year to discharge; some orders may continue longer.
Trust Deed: ~4 years in Scotland.

How to Choose the Best Debt Solution (Step-by-Step)

List your debts. Note balance, arrears, and whether each is secured/unsecured.
Prioritise essentials. Keep rent/mortgage, council tax and energy up to date first.
Build a realistic budget. Include food, transport and essentials — not just debts.
Match options. Compare IVA/DMP/DRO/Bankruptcy/Trust Deed against your situation.
Choose and start. Formal options usually freeze interest and stop most enforcement once approved.

Quick Decision Helper

Answer these quick questions to see likely options:

Repayment vs Write-Off Calculator

Estimate how long repayments might take without help vs using a formal solution:

Official Guidance & Trusted Free Support

For added reassurance, review these trusted UK resources about debt solutions:

🏛️ GOV.UK: Options for dealing with your debts
🛡️ FCA: Debt help for consumers
🤝 StepChange: Free debt advice
🧭 MoneyHelper: Dealing with debt

Frequently Asked Questions

Can I switch from one solution to another?

Yes, if your circumstances change. Always get advice first to avoid unintended consequences.

Will I lose my home or car?

Formal solutions aim to protect essentials but equity and high-value assets can affect terms. We’ll explain safeguards and options clearly.

Is help free?

Our guidance is free and confidential. Any third-party fees for formal solutions are disclosed in writing before you decide.

Compare Your Debt Solutions and Take Control Today

Don’t delay. Compare your options with expert help from Fresh Start Debt Support and choose the route that’s safest for you.