IVA – What is an individual voluntary arrangement?

An individual voluntary arrangement (IVA) is a way of dealing with personal debts that you cannot pay when they become due.

An individual voluntary arrangement is when you make an agreement with your credi tors by proposing an arrangement by which to settle its debts which has been approved by the court. In an Individual voluntary arrangement, you have formally agreed terms with your creditors on how to settle your debts.

Creditors vote on whether an individual voluntary arrangement is to be c onsidered. If a majority (in excess of three-quarters in value of the debt) of creditors accept the proposal, all creditors are bound by the arrangement. Upon completion of your individual voluntary arrangement, any unpaid debt will be legally written off as part of the agreement.

An individual voluntary arrangement must be supervised by an insolvency practitioner.

Once you are bound by an individual voluntary arrangement, your creditors cannot take any further action against you, unless you fail to fulfil the terms of the arrangement. If you fail to fulfil terms of the arrangement, the insolvency practitioner or any creditor bound by the agreement can still petition for your bankruptcy.

It is better and cheaper for you to set up an individual voluntary arrangement before you become bankrupt but you can propose one afterwards.

More information

• IVA – The individual voluntary arrangement process
• IVA – Who needs an individual voluntary arrangement?
• IVA – When to apply for an individual voluntary arrangement
• IVA – How to apply for an individual voluntary arrangement
• IVA – The advantages of individual voluntary arrangements
• IVA – The disadvantages of individual voluntary arrangements
• IVA – Insolvency and individual voluntary arrangements
• What is bankruptcy?
• What is liquidation?
• What is administration?
• What is a company voluntary arrangement?