What is an IVA (Individual voluntary arrangement) An IVA is an alternative to bankruptcy introduced by the government, if you in a situation where you can see no other alternative apart from going bankrupt you can use an IVA to avoid this option.
The concept behind an IVA is a simple one, simply a re-payment agreement between the creditors and the debtor managed by a licensed 3rd party known as an insolvency practitioner.
It was established in 1986 by the Insolvency Act but has only become more widely known about and popular recently in the last 10 years due to the "credit crunch" An IVA provides legal protection from your creditors contacting you about your debts after it has been agreed it also protects you from your creditors trying to declare you bankrupt, as they are not able to do so unless you violate the agreement by not keeping up with the repayments How Does The IVA Get Approved? If you meet the criteria for an IVA, a simplified version is below (it is highly dependent on circumstances)

• £15,000+ worth of unsecured debt
• 3 or more creditors
• Must be in full time employment
• Have a disposable income of at least £300

Note that the criteria above is a very simplified version but if you match this you have a good chance of getting accepted Once your case is approved to be looked at by an insolvency practitioner he will looking into all the details of your financial situation and if it's suitable to go ahead with an IVA he will start to work out what you can afford to pay back on a monthly basis this will be drafted into a proposal and presented to your creditors.
At least 75% of your creditors will need to accept the IVA in order for it to be put into action.
Unlike bankruptcy this is a privet agreement, in bankruptcy you have your name and details printed in all the papers declaring to everyone that you are now bankrupt You're also not allowed to be the director of a company if you have been made bankrupt and will have wait the 3 years until you can be in such a position again During this time period your financial status will be under constant review to see if there has been any change in your financial situation.
The IVA is legally binding so as long There are other debt solutions for less extreme situations such as Debt Management Plans, it's always best to seek professional advice before making a decision on what root to go down as every ones situation is different.