David Exell Associates IVA

An Individual Voluntary Arrangement (IVA) is an alternative to Bankruptcy. It is a legal process that gives an individual struggling with their debts protection from their creditors The procedure enables the individual to put a proposal to his or her creditors for a composition in satisfaction of his or her debts or a scheme of arrangement of his or her affairs. A composition is an agreement under which creditors agree to accept a certain sum of money in settlement of the debts due to them. The procedure is extremely flexible and the form which the voluntary arrangement takes will depend on the terms of the proposal agreed by creditors.

Typically an IVA lasts for between one and five years during which time interest is frozen on debts and repayments are made to creditors from the realisation of assets or from contributions made out of earnings. The agreement requires the approval of at least 75% in value of the creditors, and once approved is legally binding on the individual and all his or her creditors, whether or not they voted for it. It is under the control of an insolvency practitioner acting as supervisor. An IVA can be made by an individual who is already subject to a Bankruptcy Order. Return to Services