Interesting facts about IVA payment that you should be aware of.

IVA payment

Is it possible that the IVA payment can be paid by someone else?

It is a common problem people might face when they are partially accountable to pay credit/loans. They try to figure out if they can pay the credit back with the help of others or have someone else pay their loan, such as their parents. Other assistance is available( family/relatives and friends), but the question remains: is it possible? These are some Facts about IVA payment which will help in answering them.

Suppose  A person lost his job or something came up which made his payment hard and he couldn’t make  IVA that situation is it possible that. someone else pays for his  monthly payments till he gets back in work or able to that he wouldn’t miss any IVA payment.

The answer is no; a person can borrow money from other sources, but payments cannot be made on the debtor’s behalf.

It has no bearing on your credit file( A consumer credit file is the collection of an individual consumer’s debt repayment records, stored at a credit reporting agency (credit bureau) and is no different to paying off the debts of anyone. You can’t take out a joint IVA, However, you and the other person may be able to take out separate IVAs that are linked together (known as ‘interlocking’ IVAs).

If a person has a financial link to another person, such as a spouse, child, civil partner or divorce it may be permissible for them to propose interlocking IVAs to deal with their debts jointly.

Interlocking IVAs combine two independent plans – one for each individual – into a single agreement, with a single contribution made in repayment of both people’s debts. Under Interlocking IVA income and expenditure will be calculated individually. This does not imply that each person is responsible for the obligations of the other, and you would not be held liable for any debts other than your own.

The key benefits are that the two persons will only be charged one set of fees for the Arrangement, and creditors may receive a higher return on their debt than if two separate arrangements were presented. It also enables those persons to make a single, combined monthly payment, making it easier to handle, especially if you are used to managing your funds jointly.

What happens if our IVAs are intertwined and we get divorced?
The intresting fact about IVA payment is that your monthly expenses may be higher, your initial IVA agreement may be impacted, affecting your IVA repayments. This is due to the fact that instead of one set of monthly bills, there will now be two to consider.

As a result, people divorcing with interlocking IVAs discover that they are unable to keep the original arrangement they established. The IVA may need to be terminated and a new debt solution negotiated for each individual.

As a result, it’s critical that you and your partner reach an agreement, whether it’s to continue with an interlocking IVA and try to make the repayments, or to ask your Insolvency Practitioner to split your agreement into two separate ones.

It’s crucial to read your IVA contract carefully to determine if this is an option. If you’re unsure, please contact your Insolvency Practitioner or IVA provider for assistance.

Although there is another type of IVA present through which one can get full and final payment at once if the person has enough savings to pay at once. This is called Full & final IVAs.

For people who prefer to make a one-time payment to creditors as a full and final settlement, this is an alternative.

If you have enough resources or are in the midst of selling an item that will release funds for your unsecured creditors, this could be a viable choice.

It’s also open to individuals who have a family member or friend who is willing to contribute enough money to cover the entire IVA payment.

Is there any risk of breaching an agreement due to the reduction in  IVA Payment?

The first thing we need to understand is what is  IVA Breach and what are the conditions under which IVA breach could occur. 

Individual Voluntary Arrangements (or IVAs) are a legal way of dealing with unsecured debt. It allows a person to repay a portion of their unsecured debt to creditors over a set period of time — usually five or six years — in manageable monthly installments. “Could my IVA fail?” is a question we get a lot at Debt Movement. And we always emphasise that the Individual Voluntary Arrangement binds both clients and creditors legally, requiring them to follow the proposal’s terms. You face the danger of your IVA failing if you don’t do this.

There are a number of things you can do to jeopardise your IVA payment; nevertheless, conditions can change at any time, and your IVA will not fail immediately. You’ll first receive a notice of breach, which details how you’ve broken the terms of your agreement and what you may do to make things right.

What does an IVA Breach entail?

A breach, by definition, is the act of breaching a contract. The following are examples of IVA violations:

  • If your contributions are three months behind schedule.
  • If a person fails to supply the necessary information to complete your income and expense analysis.
  • Not paying any extra income that has been detected.
  • Taking out a loan for more than £500 without your supervisor’s consent.
  • Failure to report a windfall to your boss.
  • Failure to comply with a request from your supervisor, such as failing to sell an asset you committed to sell in your proposal.
  • Failure to pay in any money received from the sale of any asset

What Happens If I Don’t Follow My IVA payment? Is it possible that my IVA may fail?

A breach notice will identify the problem and explain how to fix it within a certain amount of time. If you do not correct the breach, the Supervisor may be forced to call a creditors’ meeting, at which they will be offered the option of terminating your IVA.

It is critical to remember that if your circumstances alter in any way — for example, if your income decreases or increases — you must notify your Supervisor. Notification of changes will allow your case to be examined, ensuring that your IVA is affordable and that you do not break the terms and conditions. Any changes must be made public.

What Happens If My IVA Fails?

If all alternative options have been exhausted and you are unable to avoid breaching your IVA, which results in its failure, you will be handed a letter of termination confirming the termination of your IVA.

If your IVA is terminated, you will no longer be protected from your creditors’ actions, and you will be responsible for the balance of your debts. Creditors can begin or resume interest charges on your debts, and there’s a potential they’ll pursue additional legal action against you, including filing a bankruptcy case. The IVA will no longer be overseen by an Insolvency Practitioner, and you will be responsible for communicating with creditors.

If your IVA fails, you may be able to do the following, depending on your circumstances:

  • Make a new IVA proposal.
  • Filing a Bankruptcy Petition
  • Create a debt management strategy.
  • Make an application for a Debt Relief Order.
  • Please obtain additional counsel before signing into a new agreement to ensure you are informed of the best option for you and your situation. This is something that the Money Advice Service can help you with.
  • When it comes to an IVA, honesty is the best policy, and you should contact your IVA provider.

What is the impact of an IVA on your credit score?

Another intresting Fact about IVA payment is You may be concerned that if you’ve ever had an IVA or are now in the process of paying off debts through an Individual Involuntary Agreement, your prospects of acquiring a mortgage have been ruined.

If you have an IVA payment to be paid then, your credit score may suffer, limiting your rate and package options. It’s a frequent assumption that having an IVA automatically means you’ll be turned down for a mortgage, but this isn’t always the case…


I’m halfway through my IVA payment and everything was going well until this morning when I received a letter from my mortgage company informing me that my fixed rate had expired and they had switched me to a variable rate. When I contacted them to change to another fixed rate, they informed me that they wouldn’t offer me any other deal due to my IVA’s negative impact on my credit rating.

Lets understand what a credit score is? 

Your credit score is essentially a representation of your financial footprint. It’s a record of all of your previous credit and payment transactions, set up so that prospective lenders can analyse your borrowing eligibility.

Any missed payments for loans or bills will be recorded as a negative mark on your credit report, while timely IVA payments will improve it.

Importantly, if you’ve never used credit before, your credit score will be lower than if you’ve had multiple loans and credit cards and haven’t missed a single payment.

If you want to use credit in the future, your credit rating will be a determining factor in how good of a loan or credit card you may get, as well as whether you’ll be able to get one at all.

An IVA will have a negative impact on your credit score, but it will not be permanent. Indeed, if you need an IVA, your credit rating is likely to be poor to begin with as a result of missed or late loan payments. In this way, an IVA can help you improve your credit score in the long run by letting you pay off all of your debts and start again.

How having an IVA on my report lowers my credit score?

Yes, it most likely will, especially if the report is still current. It’s critical to pay off an IVA on time because failing to do so could cause your credit score to drop even more, limiting your options for lenders and rates.

The higher your credit score, the better, as it shows lenders that you have a track record of good financial management. Remember, a lender may be lending you hundreds of thousands of pounds, therefore this is crucial to them.

Parting Words:

A detailed approach for IVA payment has been provided in the preceding section. In addition, certain instances have been attempted to be explained in relation to IVA payments. If you have any IVA-related questions or concerns, or if you are looking for an IVA solution, please contact us. you can also reach us through the comment section or CALL US on 03301225235 for any further assistance. We will be happy to help you further.