Do I qualify for an IVA

An IVA is an alternative to bankruptcy for people struggling with significant amounts of unsecured debt.

To qualify for an IVA you should:

owe in excess of £15,000

To qualify for an IVA you must owe at least £15,000. An IVA is not suitable for anyone who owes less than this, as creditors find it difficult to recover enough money to make it worth their while after they have paid the cost of your IVA.

have three or more different creditors

Usually you should have three or more different creditors, however if you have a significantly large debt and less than three creditors, you may still qualify for an IVA but it is at the discretion of the creditor concerned. E.g. if you owe £25,000 to two different creditors, you may be able to qualify for an IVA.

be in full time employment

Your creditors are more likely to agree to an IVA if they know you are in receipt of a regular income and therefore are able to keep up with regular payments.

not have any assets which could be used to discharge your debt

For example if you had debts of £40,000, yet owned a holiday home valued at £90,000 outright, your creditors would refuse to accept your IVA as by selling this asset, you would be able to clear your debts.
In the case of your own home, to qualify for an IVA, you will never be forced to sell your house. Your home will only ever be subject to the possibility of a re-mortgage and equity can only be used to put towards your debts if you are able to release it.

To have to remortgage your home, you must:

- be able to afford the re-mortgage repayments
- be able to find a lender willing to give the re-mortgage
- have sufficient releasable equity available