An IP (Insolvency Practitioner) is appointed to your case. They will draft a repayment proposal which describes your personal financial situation, and how you “propose” to pay your creditors over a five year period, sometimes six.
Your IVA has to be approved by your creditors, after which it is filed at court and goes into effect. Then, you’ll have to stick by the proposals presented in your arrangement throughout its entire period for it to be successful.
Once you reach the end of your arrangement successfully, and have made the designated payments, your debt to your creditors will be considered paid off. After that, you will have a clean slate and you can start rebuilding your credit score from the ground up.
If your situation changes during the IVA, either for better or worse, your IP can offer a certain degree of flexibility. If you need to, you can get a payment holiday, which would mean that your IVA would last a little longer.
Only certain debts can be placed in an IVA, which is why you should always get specific advice.
An IVA will enable you to ensure that you are being treated fairly as it takes into account how much you are able to realistically afford.