But firstly, it is important to make an overview of a general IVA program, and it works:

• You must have a certain minimum amount of debt in order to get eligible for an IVA
  
  
• There will be a professional assigned to assist you with your case, usually a qualified insolvency practitioner
  
  
• There are certain fees and charges you have to pay upfront for the services of the IP.
  
  
• The whole process is a negotiation between you and your creditors. You come up with a repayment plan, where you will state how much you can actually afford to pay each month
  
  
• Within that sum, will be incorporated the “percentage” intended as a fee for the Insolvency Practitioner
  
  
• If the majority of the creditors agree on your payment plan, the IVA enters into force and all you have to do is keep up with the payments

The main advantages of going through an IVA are:

• Collection departments and creditors will automatically stop calling you to remind you about your debts, once you have started an IVA program. From this point of view, you are protected by the program.
  
  
• If you truly keep to the scheduled repayments plan, in a matter of 5 years you will become debt free. All IVA programs require that the repayment schedule is calculated for 60 months of payments.
  
  
• An IVA is a way much better solution than filing for bankruptcy. After you are finished with your IVA, you will not have debt issues mentioned within your credit record for 10 years (like in the case of bankruptcy!)
  
  
• You will never be required to pay more than you can afford. You will set up a repayment plan based on your ability to make the repayments, and more importantly based on your income.
  
  
• You will not get advertised in the London Gazette (unlike the case for those going through bankruptcy!)
• All of your personal information is being treated confidentially.
  
  
• Going through such a program will definitely constitute a positive experience, in the sense that the financial advices you will get there will teach you to deal professionally with debt related issues.
  
  
• The fact that you will stay away from bankruptcy is an achievement
  
  
• After going through the IVA successfully, you can think about continuing your life without the burden of debts

These are he main advantages of going through an IVA, and if you compare them with the disadvantages, you will see that the best option to undertake when you are struggling with highly accumulated debts is still the Individual Voluntary Arrangement.

Disadvantages:

• For a time frame of five years, you really need to keep up with all the payments, otherwise you will be forced by the circumstances to undertake bankruptcy as an option
  
  
• A full and final settlement within an IVA means that you will have to sell your property in order to pay off all your creditors.
  
  
• It requires more effort both moral and financial to be able to go through an IVA successfully, than if you would choose bankruptcy as an option
  
  
• The process may result in a negative outcome for you if you do not keep up with the scheduled repayments
  
  
• Just as bankruptcy, IVA will also show within your credit records, but you can start building it up again when the term is up, and you have successfully gone through the program’s requirements
  
  
• An IVA generally requires that you make a declaration about all the assets that you own; if the creditors consider that you have too much property in your possession, they might ask you to sell in order to pay them back (or to release equity that you have in your home)

As seen, there are also disadvantages present, but no financial agreement exists without a certain degree of risk. Before you opt for an IVA, carefully consider all the options that are available, and which can help you become debt free. Ask the opinion of a professional, especially if you are not sure whether an IVA is the right solution for you. Good financial management will always require patience and time so do not jump into any option until you are sure it is the best solution in your case.