Can Bailiffs Refuse A Payment Plan?
Yes – In Short, Bailiffs can refuse payment plans, However there are options available to help you.
September 6, 2025
- Written by Advice Centre Group Editorial Team
- Last updated: 11 September 2025
IVA Pros and Cons
If you’re struggling with unmanageable debts, you may have come across the term IVA — short for Individual Voluntary Arrangement It’s one of the most common debt solutions in the UK, but before you decide if it’s right for you, it’s important to understand both the advantages and disadvantages.
An IVA can help you write off unaffordable debt, protect you from bailiffs and creditors, and allow you to make one affordable monthly payment. But it also has drawbacks, including a long commitment and impact on your credit rating.
This guide breaks down the real IVA pros and cons, explains who qualifies, explores alternatives, and answers the most frequently asked questions. If you need personalised advice, Advice Centre Group offers free, confidential debt help — so you can make the right decision for your situation
IVA Pros And Cons
What Is an IVA and How Does It Work?
An Individual Voluntary Arrangement (IVA) is a legally binding agreement between you and your creditors to repay part of your debts over a set period, usually five to six years.
Here’s how it works:
Assessment – An Insolvency Practitioner (IP) reviews your income, expenses, and debts.
Proposal – They prepare a repayment offer for your creditors, based on what you can afford.
Voting – Creditors vote on the proposal. If 75% (by debt value) agree, the IVA becomes legally binding on all creditors.
Payments – You make one affordable monthly payment to the IP, who distributes it among creditors.
Completion – At the end, any remaining unsecured debt is written off.
Example:
If you owe £25,000 across 8 creditors and can afford £150 per month, you’ll pay £9,000 over 5 years. The rest — £16,000 — is written off.
An IVA is supervised by a licensed Insolvency Practitioner, ensuring compliance with the law and fairness to both you and your creditors
Find Out More On “What is an IVA ” – Click Here
Advantages of an IVA
An IVA can provide life-changing relief for the right person. Let’s break down the main benefits:
Debt Write-Off
At the end of the IVA, any unpaid unsecured debt is written off.
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If you owe £20,000 and pay back £9,000, the rest (£11,000) is cleared.
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This makes an IVA one of the few debt solutions that actually reduces your overall debt.
Protection From Bailiffs and Creditors
Once approved, creditors cannot:
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Send bailiffs to your home
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Add further interest or charges
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Take you to court for CCJs or enforcement
This protection is immediate once your IVA is in place.
One Affordable Monthly Payment
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Payments are based on your disposable income (what you can realistically afford).
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You only make one payment, not juggling multiple creditors.
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Reviews each year ensure payments stay manageable.
Assets Are Usually Protected
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In most cases, you keep your home if mortgage payments are maintained.
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Cars and work tools are usually safe if essential for daily living or employment.
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Unlike bankruptcy, your possessions aren’t automatically at risk
Legally Binding for All Creditors
Even creditors who voted against the IVA are bound by its terms, giving you certainty.
Key takeaway: An IVA gives you breathing space, legal protection, and a path to becoming debt free without losing everything you own.
Disadvantages of an IVA
While IVAs are powerful, they’re not right for everyone. Here are the main drawbacks to consider:
Impact on Credit Rating
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An IVA stays on your credit file for six years.
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Getting new credit, mortgages, or even some job applications can be more difficult.
Long-Term Commitment
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You must stick to payments for five to six years.
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Missing payments risks the IVA failing, leaving you vulnerable to creditors again.
Not All Debts Are Included
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Secured debts (like mortgages and car finance) are not covered.
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Certain debts (e.g., student loans, fines, child maintenance) can’t be written off.
Not All Debts Are Included
The Insolvency Practitioner’s fees come from your payments, reducing what goes directly to creditors.
Key takeaway: An IVA can give relief, but it also requires discipline, affects your credit, and isn’t suitable for everyone.
Pros Of An IVA
- Combines all your debts into one simple monthly payment.
- Stops creditors from chasing you, taking legal action, or sending bailiffs.
- Interest and additional charges on your debts are frozen
- Allows you to keep important assets like your home or car in most cases.
- Provides peace of mind, knowing you’re protected and can focus on moving forward without constant stress.
- A clear timeline to becoming debt-free, so you know when it will end
- There’s an opportunity to have some of your remaining debt written off once the IVA is finished.
- Payments are affordable and include all costs involved, so there are no surprises.
- A portion of your debt could be written off once the IVA is complete
- Once completed, it’s removed from your credit file, giving you a fresh start
Cons of an IVA
- Your credit rating will be impacted, and the IVA stays on your credit report for six years.
- An IVA is listed on the public Insolvency Register, which is accessible to lenders and employers.
- It can be challenging to get further credit while on an IVA.
- Only unsecured debts are included, so secured debts (like mortgages) aren’t covered.
- You may need to pay unexpected windfalls, like bonuses or inheritance, into the IVA.
- Failing to keep up with payments can lead to the IVA being cancelled, which might result in further financial challenges or bankruptcy.
- Not everyone is eligible for an IVA, as it requires meeting certain criteria, like having a stable income and sufficient debt levels.
- Some job sectors may restrict employees from entering into an IVA due to professional rules.
We have supported 11,300+ individuals on their journey towards financial well-being.
Hear From Darren
The Advice Centre Group Has Given Me Hope.
I have been really helped by the Advice Centre Group. The person who helped me a great deal was called Long, and he really did guide me every step of the way. My debts were crippling and the IVA has really given me hope that I can start afresh and at the same time responsibly pay my creditors what I can.
Thankyou
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Who Should Consider an IVA?
An IVA may be right if you:
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Have £6,000+ in unsecured debts across multiple creditors
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Have a steady income (employment or benefits)
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Can make regular monthly payments
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Want to protect your home from repossession
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Are being chased by bailiffs or creditors
An IVA may not be suitable if you:
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Owe less than £6,000
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Have no reliable income
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Mostly have secured debts (like mortgages or car loans)
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Need a short-term solution
Example Scenarios:
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John earns £1,800/month, owes £22,000. He can afford £160/month → IVA fits.
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Sarah owes £4,000, lives on benefits → DRO would be more suitable.
Who Should Consider an IVA?
Not sure an IVA is right? Here are alternatives to consider:
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Debt Management Plan (DMP): Informal, flexible monthly repayments, but creditors can still chase.
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Debt Relief Order (DRO): For debts under £50,000, low income, few assets.
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Bankruptcy: Quick debt write-off, but serious consequences (loss of assets, restrictions).
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Consolidation Loan: Combines debts into one loan, but may not be available with poor credit.
👉 Advice Centre Group discuss an IVA in contemplation of an appointment of an IVA, if we find another solution may be a better option we will passs you onto those who can help with those
Frequently Asked Questions
For many people, yes. An IVA can make debts affordable, stop creditor contact, and give you a clear route to becoming debt-free. However, it does affect your credit file and requires a long-term commitment.
Is an iva worth it – CLICK HERE
IVAs are usually best suited if you owe more than £6,000 to two or more creditors and have a steady income.
Yes. Once your IVA is approved, bailiffs and other enforcement action must stop, provided your debts are included in the IVA.
Most people keep their home in an IVA. If you own property, you may be asked to release equity in the final year, but repossession is not part of the process unless you fail to maintain payments.
IVA And Mortgage Blog – CLICK HERE
At the end of the IVA, any remaining unsecured debt included in the arrangement is written off, and you’ll be issued a completion certificate.
Final Thoughts? - IVA Pros And Cons
The pros of an IVA are clear: affordable payments, frozen interest, creditor protection, and eventual debt write-off. The cons of an IVA include its effect on your credit rating, the long-term commitment, and possible equity release.
For many people, the benefits outweigh the drawbacks. An IVA can be the first step towards a debt-free future
Learn more about managing your debt:
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Adam Southard is authorised as a Licensed Insolvency Practitioner in the United Kingdom by the Insolvency Practitioners Association, We only provide advice after completing or receiving an initial fact find where the individual(s) concerned meet the criteria for one of our insolvency solutions, therefore, all advice regarding Individual Voluntary Arrangements (IVA) is given in reasonable contemplation of an insolvency appointment.
Adam Southard is licensed to act as an Insolvency Practitioner in the UK by the Insolvency Practitioners Association. Office Holder No. 11930
Insolvency Practitioner Directory- Insolvency Practitioner Details (bis.gov.uk)
What you need to know about Individual Voluntary Arrangements
(Insolvency Service)
We provide solutions to individuals throughout the UK, We Will help recommend solutions available to your circumstances in which you can then make an informed decision about which solution you qualify for is best for you and your circumstances.