Iva Time Limits – How Long Does an IVA Last?

In this section, we will be focusing on the time frames associated with IVAs. For more information on other areas, there are numerous other articles available on IVAs on our website.

What is an IVA?

As a brief introduction, and individual voluntary arrangement (IVA) is an agreement between creditors and a person who has debt held by those creditors. It may be possible to use one lump sum, or monthly repayments over an agreed period of time in return for writing off all, or some of the debt.

What is the process involved?

IVA time line

An IVA process typically takes about six weeks from start to finish, but this, of course, depends on how quickly you respond with paperwork and supporting evidence.

The whole process can be roughly broken into six stages:

  1. Initial contact with an impartial financial advisor who will go through your options, and whether an IVA is really the best course of action for you to take. They will examine your income, expenditure, assets, and debts in order to calculate how much you can realistically afford to offer your creditors on a monthly basis, or with a lump sum.
  2. If it is agreed that an IVA is appropriate in the circumstances, then a Statement of Affairs is drafted. This will offer a consolidated view of your finances and is the start of your IVA proposal. The proposal itself will normally be set out by an Insolvency Practitioner acting as a nominee and will contain all of the relevant details required such as pay slips, bank statements, etc. Your nominee may also at this stage apply for Interim Order which will prevent further action taken by creditors until the IVA has been considered.
  3. Once you are happy with the IVA proposal it is distributed among the creditors involved, along with the insolvency service and county court. This will include a proposed date (at least 14 days after the distribution of the proposal) known as the ‘Meeting of Creditors’ where a vote will take place on whether to accept your proposal. Any modifications to the proposal are normally requested before the meeting but can occur at the meeting itself. This date is also not set in stone. If creditors need more time to consider the proposal, the meeting can be adjourned to a later date.
  4. A vote on your proposal will take place at the meeting, with 75% of the votes (in value of debt) needed for it to be approved. At this point, all unsecured creditors, regardless of how they voted, are legally bound to the IVA agreement.
  5. Once this is approved, all parties are notified of the arrangement and a supervisor is assigned to monitor monthly payments, or in the event of a lump sum, to distribute it among the creditors.
  6. As long as you keep up with your repayments for the proposed schedule, your obligation towards the debt will come to an end on completion of the IVA period.

What happens if IVA payments are missed?

Any missed payments will be added on to the end of the payment program, meaning it may stretch past the 6-year mark.  A short payment holiday is normally allowed in emergency situations, but anything longer will need to be agreed by the creditors before any major changes are made.

How long does IVA last?

An IVA typically runs for 5-6 years, though this period can be extended if you miss repayments. You will, of course, need to adhere to the rules set out and there will be certain financial constraints that you will have during this period.

How does an IVA affect you?

How does an IVA affect you?


You’re likely to have to keep to a budget during this time and any additional income that may come your way, such as bonuses may need to go towards the debt.


There will be a cap of £500 on borrowing during your IVA period. Anything above that will need to be approved by the insolvency practitioner. It will also likely be a difficult time to be approved for credit.


Depending on what was included in the agreement, you may need to sell valuable items that are not considered essential to your livelihood. If you have items that you are still paying off, they will likely need to be returned.


Any savings you had will normally be used towards the debt.

Job or business

This may not affect most professions, with the exceptions of accountancy, law and other similar sectors. You should always check your contract with your employer before going into an IVA. Some employers might contain a clause about IVAs or other forms of insolvency regardless of the sector you’re in.  Even then any decision will be taken by your employer if it is considered a breach of contract.  If you own your own company, an IVA can damage the company’s reputation or ability to function well with companies able to check the Insolvency Register before carrying out any business with you.

How long does Iva stay on my credit file?

Credit card debt persistent

An IVA appears on a credit file for six years, just like any other kind of debt. This begins from the date it was approved. It will not be removed if you finish the IVA early but will be marked as ‘complete’.  It’s important to bear in mind that because of the IVA there won’t be much credit information on this 6-year period, which is likely to leave a low credit score.

Do you have to declare an IVA after 6 years?

If you are formally asked either on a form or in person after the 6-year period you are still legally required to disclose the information. That being said, the onus is not on you to declare the information upfront without being asked.