Over a set time, normally 60 months, you make contributions to an Insolvency Practitioner (the Supervisor of the IVA) who then makes creditor repayments in accordance with the laws of The Insolvency Act 1986.

An IVA protects you from creditors who are owed sums at the date of the IVA and makes your debt more manageable.

The amount you pay back depends on your individual situation.

The amount you owe, expenditure, living arrangements and your income all need to be taken into account.

For an IVA to be initiated, over 75% of creditors must approve it.

In order for an IVA to be a viable option, you should:

• Be insolvent and unable to pay back your debts as they fall due.
• Owe money to two or more creditors
• Have debts over £10,000
• Have a surplus income every month or another way to make a contribution to the IVA (maybe from a third party).