If you’re considering an IVA (Individual Voluntary Arrangement), you’re probably already aware that it’s an agreement between you and your creditors to pay back a reduced amount of your debt over a five-year period. But are you aware of all the implications?

IVA’s are treated in a case-by-case basis, so it will depend on your individual situation as to what will happen to your assets. Your IVA Practitioner will be able to advise you if you will have to sell any assets once they understand your situation.

What will happen to my house?
One of the advantages this debt solution has over bankruptcy is that you’ll be able to keep your house. Toward the end of an IVA, it’s quite normal to have to release equity from your house as a final payment to the creditors.

Will I have to sell my car?
You should be able to keep your car during an Individual Voluntary Arrangement, but if your car is considered to be luxurious, you may be expected to sell it for a cheaper model. The money you gain from this would be put into your IVA. If you have multiple cars, you may need to justify your reasoning for needing them (such as having a large family or a work necessity).

What if I receive any windfalls during an IVA?
Any windfalls you receive during an IVA must be reported to your Insolvency Practitioner and may have to go toward your debt. Windfalls include any inheritance, work bonuses and lottery wins.

Will my bank accounts be affected?
If you have other savings accounts, like endowment policies or premiums bonds you might have to release funds to go toward paying your debt as well.

If you need more information on IVAs it’s best to get debt counselling and professional advice for your individual situation.