How to apply for an IVA

The process has six stages, and the most important work happens before anything is sent to a creditor. Get independent advice first, read the key facts document properly, and do not sign a proposal you are not sure you can keep up for five or six years.

Step 1: Get debt advice and look at every option

An IVA is one of several ways to deal with debt, and for many people it is not the right one. IVAs are only available in England, Wales and Northern Ireland; if you live in Scotland, see debt solutions in Scotland. Before you commit, speak to a free, impartial debt adviser: MoneyHelper, StepChange, Citizens Advice and National Debtline can all compare your options. See where to get free debt advice.

If creditors are pressing you while you decide, ask the adviser about Breathing Space. It gives up to 60 days in which creditors cannot contact you about the debts included, cannot add interest or charges, and enforcement is paused. You can only get it through an FCA-authorised debt adviser or a local authority, and not once an IVA has started.

Step 2: Choose an insolvency practitioner

Only a licensed insolvency practitioner (IP) can propose and supervise an IVA. You may deal with a company that employs IPs, but the nominee and supervisor must always be a named individual, because a company cannot itself be an IP.

You can check any IP on gov.uk’s find an insolvency practitioner search. Citizens Advice suggests contacting more than one and asking each for an estimate of their costs. See what an insolvency practitioner does and how to choose an IVA provider.

If a website or firm has referred you, the IVA Protocol requires the nominee to record who referred you and their connection to you and your creditors in the proposal. The nominee must also make sure any third-party referrer is FCA-authorised for debt counselling, or direct you to someone who is.

IVA Helpline is one such introducer. We do not set up IVAs. If you use our checker, we may pass your details to a licensed insolvency practitioner or debt adviser.

Step 3: The assessment

The IP will look closely at your finances. Under the IVA Protocol 2025 they should:

• run a credit history search and review the result
• check your income, spending, assets and debts, in proportion to your situation
• draw up a budget for your whole household, where appropriate, using the Standard Financial Statement
• ask you to value any property you own, and verify that valuation
• ask about previous dealings with them, any IVA in the last 24 months, any Breathing Space, debt management plan, debt relief order or bankruptcy

They should also explain all the options available to you and record why you are choosing an IVA over the others. Our guide to the documents you need lists what to gather.

Step 4: The key facts document and your proposal

Before you sign anything, the nominee must send you a key facts document for protocol IVAs and a copy of the Protocol itself, and be available to answer your questions. The key facts document is short. Read all of it.

You then sign two documents: the proposal (the terms you are offering creditors) and a statement of your affairs (your assets, debts and creditors). The proposal has to set out, among other things:

• how long the IVA will last and what you will pay each month
• how your payments will be split between the IP’s fees and your creditors, with a schedule of when creditors are expected to be paid
• who referred you, if anyone
• why an IVA is the most appropriate solution, if your debts are under £7,000, your spare income is very low, or you would qualify for a debt relief order

Questions to ask before you sign

• What will the fees be in total, in pounds, and when will my creditors first receive anything?
• If creditors reject the proposal, what will I owe you?
• What happens if I miss a payment or lose my job?
• What will happen to my home, my car and my pension contributions?
• Which other options did you consider for me, and why did you rule them out?
• Who referred me to you, and were they paid?

Step 5: The nominee reports and creditors vote

Within 14 days of receiving your proposal, the nominee sends a report to your creditors, giving their opinion on whether it has a reasonable prospect of being approved and carried out. Creditors must then get at least 14 days’ notice of the decision date. Most votes happen by electronic voting or by post. A physical meeting is only held if enough creditors ask for one.

The proposal is approved if at least 75% of the debt, by value, of the creditors who vote say yes. It fails if more than half of the value of creditors who are not connected to you vote against. Under the Protocol, a creditor that votes against a protocol-compliant proposal should give its reasons.

For example, say you owe £30,000: £15,000 to a bank, £9,000 on a credit card, £4,000 on a loan and £2,000 on a catalogue. The bank and the card company vote yes, the loan company votes no, and the catalogue does not vote. The votes cast total £28,000, and £24,000 of that is yes, which is about 86%. The IVA is approved, and it binds the loan company and the catalogue too. If the bank had voted no instead, the proposal would have failed. (Hypothetical figures.)

Creditors can ask for changes to the proposal, but they cannot approve a changed version unless you agree to each change. Our guide to how creditors vote covers this in more depth.

Step 6: Approved or rejected

If it is approved, the IVA starts, binds every creditor who was entitled to vote, and is entered on the public Individual Insolvency Register. Interest and charges on the included debts are frozen and you start paying your supervisor. See how an IVA works for what happens next.

If it is rejected, Citizens Advice says you will still need to pay the fees you owe the IP, which can usually be added to your existing debts. You then need to look at the alternatives, such as a debt management plan, a debt relief order or bankruptcy.

Common mistakes when applying

• Signing on the first call. Nothing about an IVA needs to be agreed the same day. Take the key facts document away and read it.
• Shrinking your budget to make the offer look better. The payment has to last five or six years. If your food, travel or household costs are set unrealistically low, the IVA is more likely to fail.
• Leaving out a debt or an asset, even one you plan to deal with privately. The IVA binds creditors you forgot, and debts turning out 25% or more higher than your proposal says is a breach.
• Assuming a court is involved or that you must attend a meeting. Neither applies to a normal IVA.
• Only speaking to firms that offer IVAs. The FCA warns that some lead generators push people towards IVAs because they are paid to.

What to do next

1. Before you speak to any IVA firm, ask an independent adviser to compare an IVA with every other option you have.
2. Gather your paperwork using our documents checklist, so the assessment reflects your real finances.
3. If you go ahead, check your IP on gov.uk, ask the questions above, and do not sign until you have read the key facts document. The rest of our guides are on the IVAs explained page.