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If you are experiencing difficulties with keeping up with your debt repayments then you may be considering an Individual Voluntary Arrangement (IVA) as a solution to these problems. Although they can be a good way to clear your debts, IVAs aren't suitable for everyone and so how do you know if an IVA is right for you?

An important consideration in whether an Individual Voluntary Arrangement is the best debt solution for you will be how much money you owe. The purpose of IVAs is to help people with significant financial problems that would otherwise have no other option but to declare bankruptcy. Generally IVAs are intended to help people with debts of at least £12,000 and so if you owe less than this amount then you should consider other options such as a debt management plan.

An IVA may be the best solution to your debt problems

The most common type of IVA is a fixed term IVA. This will consolidate your debts into a single monthly payment that you make for a set period of time, usually five years. For an Individual Voluntary Arrangement to be right for your circumstances you just be able to keep up with these monthly payments. Therefore you can only enter into an IVA if you are employed and have a regular income. You must also be able to make payments sufficiently high enough to satisfy your creditors.

Only unsecured debts can be included in Individual Voluntary Arrangements with common types of debts like mortgages, secured loans and student loans being excluded. Therefore for an IVA to be right for you the money you owe must be made up of unsecured debts, for example credit cards and store cards.

Find out if an IVA is right for you

In the UK there are a number of ways in which people can clear their debts. If you are struggling with debt then the best option for you will depend on your own unique circumstances. Whatever your financial situation Spencer Hayes can help you with our impartial debt counselling service.

To find out what is the best solution for you call our debt helpline on 0800 028 4422. Alternatively complete our enquiry form to request a call back.