First – what is an IVA?

An IVA (Individual Voluntary Arrangement) is a legally binding repayment plan established by the Insolvency Act 1986. It provides a flexible mechanism by which a debtor can pay off their creditors, and avoid the overheads and implications of bankruptcy.

Why Choose an IVA?

Our circumstances change constantly; a year ago, property investments were the sure thing, and the banks bent over backwards to provide easy access to credit. These investments, and our easy-credit culture aren’t looking so comfortable any longer, and are starting to squeeze the very people they claimed to help in the first place. The banks have two options:

  1. Maintain the debt, which is great for them as your total interest payments only ever increase
  2. Bankrupt the debtor, to liquidate their assets and attempt to recover as much debt as possible.
Bankruptcy is an expensive option for all parties; for the bankruptee, it will also wreck their credit score, block credit lines, force any directorships to be ended, lose their property, and impact their employability.
The IVA provides an alternative that your creditors would rather you didn’t have, as it’s designed to work in the debtor’s interest. With an IVA,
  • Your employability is not impacted
  • You do not have to step down as a director of a company
  • You are not registered at the government’s Personal Insolvency Register (or published in the local newspaper and recorded in the London Gazette)
  • You do not have to sell your assets
  • You do not put your home or investments at risk
  • Creditors cannot take action outside the framework of the IVA

OK, so what happens next?

First, we check that an IVA is the best option for you. Our application process is designed to screen out those for whom an IVA is not suitable; we strongly recommend seeking alternatives, if they are at all available. These could include
  • Family loans
  • Selling assets to raise cash
  • Reducing monthly expenditures
  • Taking a weekend or part-time job
  • What not to do – A number of websites offer to provide consolidation loans and ‘payday loans’ – these preditory practices will simply make any situation you may be in worse, and we advise all our clients and potential clients to consider the motives behind them before buying their products.
Our second stage involves drafting a proposal to your creditors, outlining a proposal plan. This is based on your disposable income, which is based on your monthly income, less your outgoings: a number of items are legally safeguarded, accomodating a reasonable expenditure for
  • Food
  • Travel and transport
  • Heating, electrical and utility bills
  • Mortgage or rent
  • Insurance, pets, tobacco and other miscellaneous expenses
We then take stock of all your creditors, and design a repayment plan. This aims to repay your creditors pro rata, which is simply a legal term meaning proportional. If you owe company A and B £500 each, and company C £1000, the plan would look like the following:
first-stage pro-rata repayment plan
Creditor Amount owed Percentage of total
total £20000 100%
Company A £5000 25%
Company B £5000 25%
Company C £10000 50%
However, our expert team can negotiate a guaranteed 66% write-off of your total debt. This reduced amount is what you repay. Our repayment plan, spread over a 60 month period, now looks like this:
EndTheSpend negotiated plan (over 60 months)
Creditor Amount Total repayment
after write-off
Monthly contribution
total £20000 £6667 £111.11
Company A £5000 £1667 £27.78
Company B £5000 £1667 £27.78
Company C £10000 £3333 £55.55
If you can afford to pay more, you can become debt-free in less time (and would urge you to do so).
Once our team and your creditors have devised a settlement you agree with, we put it into action. You start making your monthly payments, and interest on those debts are frozen. You may still recieve a few demand letters as your new relationship with these creditors works through their systems and credit agentss, but soon enough they will end and you can simply pass them on to our team in the meantime – we will intervene on your behalf and ensure each creditor is in compliance with your new arrangements.
If you instead choose to take the bankruptcy route, either through choice or circumstances beyond your control, be aware of the following possible outcomes
  • Everyone knows you’re been through a bankruptcy
  • You have to disclose your bankruptcy for the rest of your life
  • You may have to sell your home 
  • You can lose your job
If you have further questions, you can write to, phone or email us – be wary of sites who will not provide you with these details.