Iva Calculator

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iva calculator

This page was last updated on 1 July 2021

IVA Calculator In 2021

What is an IVA? 

IVA, short for individual voluntary agreement, is a type of debt solution for unsecured debts. Since a secured loan or debt has collateral, you will not need to turn to debt write off. Your creditors will instead use whatever collateral you secured when making the agreement. 

This type of debt solution works by having you make monthly payments for 5 years towards your debts. These payments are known as voluntary arrangements. 

After the 5 years any outstanding debt is simply written off. So for many an IVA is a good way of fixing  their financial situation. 

An IVA is an official agreement and therefore you are bound legally to your monthly payment amount. During individual voluntary arrangements all interest rates are frozen, so you won’t be hit with any unexpected costs you cannot afford. 

In some cases an IVA agreement may be extended, normally by 12 months. Normally this is because you previously took a payment holiday or had to have your monthly bill reduced.

Topics that you will find covered on this page

You can listen to an audio recording of this page below.

What are IVA Calculators?

IVA calculators are online tools used by people undergoing contemplation of an insolvency. The calculators help people see how much debt they would need to repay to their creditors and how much debt would get written off. 

They are used by many as an ‘advice’ tool, to see whether an IVA is the best insolvency solution for them. They give you a free debt report, but are not 100% accurate. 

Are IVA calculators reliable?

An IVA calculator is a good way of estimating what your monthly repayment amount would be, and whether this is affordable for you. 

However, remember that an IVA calculator only gives an estimate based on limited details you enter. An IVA calculator cannot guarantee that if you applied for an IVA you would be approved. 

You get a more reliable picture of your eligibility if you make an insolvency appointment. Get in touch with insolvency practitioners to do this. Always be sure that you use advisors who have  membership at the insolvency practitioners association. 

An insolvency practitioner will look at all of your ingoings and outgoings and create a full proposal. The proposal includes what you would need to pay back monthly. You can give this to your debt creditors. 

You should also be aware that if you put in personal details on an online calculator, the company may then contact you via phone or email. 

Here is a short video explaining what an IVA is.

Where can I find an IVA calculator?

There are many online IVA calculators that you can use to consider your individual voluntary agreement. 

Payplan offers an online estimation tool for which you are not required to enter personal details. 

If you would like a more accurate estimation, then you can use an IVA calculator that asks for more details. These details can help the IVA calculator assess your IVA budget. 

However, always be wary of the sites you use and their compliance with data protection. 

How does a calculator work for IVAs?

You will be asked to give details of the number of different creditors that you owe money to, as well as the total amount owed. You might also need to provide your income and monthly outgoings as well. 

The more personal financial details you provide, the more accurate the IVA estimate. However, in all cases calculators only give estimates. They in no way guarantee acceptance for an IVA. 

So, you should use an IVA calculator if you are interested in knowing what your chances of being accepted are. You can also use some calculator’s to estimate 

Individual Voluntary Arrangement

What is the minimum IVA payment?

Normally, you need to pay £80- £100 each month, minimum. 

How much debt is written off in an IVA?

Firstly, you should know that no IVA will ever write off all of your debt. 

There is not a fixed amount that can be written off, either. The amount written off will vary on a case-by-case basis, depending on your income and outgoings. 

"IVA calculators are online tools used by people undergoing contemplation of an insolvency. The calculators help people see how much debt they would need to repay to their creditors and how much debt would get written off. "

What should be my next steps after using an IVA calculator? 

If the iva calculator indicates that an individual voluntary arrangement (IVA) might be a good debt solution for you then your next steps should be:

  • Get more personal advice about this type of debt solution. You could get advice from the National Debt Service, Citizens Advice, or an Insolvency Practitioner themselves. 
  • Ask an insolvency practitioner to write you an iva proposal. This step requires them firstly to see if you qualify. They do this by considering how much you owe in relation to your income, outgoings, and disposable income. 
  • The final step is to present the individual voluntary agreement (IVA) proposal to your creditors. 

What does a practitioner for insolvency do?

Essentially they look at your total debt and give you debt advice. Specifically, they assess whether you qualify for an IVA. 

To see if you qualify for an IVA they must see whether an IVA could work for you, or if other insolvency solutions might be better. They look at how much of your debts you can afford to pay back, monthly, based on your financial circumstances. 

Your practitioner can also write and apply for a court order during the time that your IVA is being set up. Without this, creditors may try and take legal action even though you are arranging debt solutions. 

Unfortunately, the use of a practitioner for insolvency solutions is not free. You will need to pay a fee, and if you choose to use a debt management company as well then they also charge fees. 

You should always make sure that your practitioner is part of the insolvency practitioners association. This association sets out a clear code of ethics when it comes to debt solutions, ensuring that your agreement is a safe one. 

Do I qualify for an IVA?

It is impossible to know whether you qualify for an IVA without officially obtaining a proposal. Even people that use a calculator only get an estimate. 

To get a proposal for this type of debt solution you must provide details of your personal finance. Your creditors need to see that you can afford the IVA fees, and have sufficient monthly income to make your monthly payment. 

Essentially, a creditor wants to find the best outcome for them for your debt. 

So, your proposal needs to show your mortgage lender, mortgage broker, bank,  car finance or other specialist lender, that the best solution for your credit issues is an IVA

If rejected, it is likely because your creditor thinks other methods of debt management will give them a better return. For example, a debt management plan, or declaring bankruptcy. Even if an IVA calculator says you qualify, you can still be rejected for an individual voluntary agreement. 

Typically people that do manage to qualify for an individual voluntary arrangement (IVA):

  • Have a minimum unsecured debt amount of £7000
  • Are in a financial situation which means they cannot make the current  repayments for their unsecured debts
  • Do have steady financial incomings 
  • After paying all of their bills have at least £80 a month to pay towards their debts

How quickly can I set up my individual voluntary arrangement? 

Setting up individual voluntary arrangements for your unsecured debt can take around 6 weeks. 

Firstly, you must get your total debt assessed and a draft IVA produced. We recommend also getting debt advice before paying any fees. 

Then, you write to your creditors to present them with the draft. They then have 2 weeks to to approve you for an IVA. 

Voluntary Arrangements

What happens once I set up my IVA? 

Once it is all set up you can be reassured as your creditors can no longer contact you! 

Your job, then, is to make all of your monthly payments on time for the next 60 months. 

When this time comes to an end the remainder of your unsecured debts are written off. You are officially debt free! 

How will an IVA affect someone’s credit score?

Your IVA will be viewable on your credit report or credit file for 6 years after the IVA begins. During the IVA you are put on the insolvency register, which has an adverse credit impact. 

However, you are taken off of this public register when your debts are fully dealt with. Then, you can begin to repair your credit history and build a better credit rating for yourself. 

Can you get a mortgage on IVA?

During your monthly or lump sum IVA mortgages are quite hard to get. High street companies tend to reject applicants, so our advice is to look to specialist lenders for a mortgage. 

Be sure you have the required financial resources to do this, though. Typically your deposit fees will be higher, and you do not want to accrue even more debts. 

Better mortgage deals can be found when your debts to your creditors are officially settled. For example, a smaller interest rate and deposit may be obtained. For many, waiting until after their debts are settled is a better solution. 

If you are struggling with Debt, would you like to speak to a specialist to discuss what options you have?

We work with Money Advisor who is able to help you, if meet the following 2 criteria:

1 – Your level of debt is £2,000 or over

2 – You have at least two creditors (ie two or more companies you owe money to)

If you meet the criteria, and would like some help, you can contact us in one of 2 ways:

  • Option 1 – Call us directly on – 0333 567 1613
  • Option 2 – Leave us your contact details and we will get in touch with you

 

Option 1 – Call directly to book an appointment with a debt management specialist

Our lines are open Monday to Friday – 9:00 to 8:00pm

Option 3 – Leave us your details and we will get in touch

Leave your contact details below and one of the Money Advisor team will give you a call to discuss your needs.

Please note that all calls are undertaken by Money Advisor who help thousands of individuals find solutions to get out of debt and. They can help you understand all the possible options and guide you through the various processes.

Learn More About Debt Management In The UK

Debt Management plans

A debt management plan is a means of helping you solve your debts. It involves negotiating an agreement between you and some or all of your creditors in order to pay off your debts. 

mortgages if you are bankrupt

There is no hard and first rule when it comes to what lenders will accept your mortgage application if you want to get a mortgage after bankruptcy. Mortgage lenders who lend to discharged bankrupts generally consider each unique case individually. 

debt relief orders

Debt relief orders (often abbreviated to DRO) are a method of debt reduction if your debts are more than you can manage and you cannot afford to pay them.

What is an IVA?

An IVA is a kind of debt solution: more specifically, it is a legally binding agreement between you and your creditors to pay back your debts over a particular time period. This article explores the impact of having an IVA and what it could mean for your day to day life.

what is bankruptcy

Bankruptcy is a legal status which has a duration of one year in England and Wales. It can be an option for taking care of debts that you are incapable of paying.

impact of credit rating an IVA

An IVA won’t affect your credit score forever. It will normally only be kept on your credit file for six years in total.  This is because an individual voluntary arrangement usually lasts for five years, and after it ends it will remain on record for one more year.

Article author

Katy Davies

I am a keen reader and writer and have been helping to write and produce the legal content for the site since the launch.   I studied for a law degree at Manchester University and I use that theoretical experience, as well as my practical experience as a solicitor, to help produce legal content which I hope you find helpful.

Outside of work, I love the snow and am a keen snowboarder.  Most winters you will see me trying to get away for long weekends to the slopes in Switzerland or France.

Email – katy@helpandadvice.co.uk

LinkedIn – Connect with me

Frequently Asked Questions

What are IVA Calculators?

IVA calculators are online tools used by people undergoing contemplation of an insolvency. The calculators help people see how much debt they would need to repay to their creditors and how much debt would get written off. 

Are IVA calculators reliable?

An IVA calculator is a good way of estimating what your monthly repayment amount would be, and whether this is affordable for you. 

How does a calculator work for IVAs?

You will be asked to give details of the number of different creditors that you owe money to, as well as the total amount owed. You might also need to provide your income and monthly outgoings as well.

What happens once I set up my IVA? 

Once it is all set up you can be reassured as your creditors can no longer contact you! 

Your job, then, is to make all of your monthly payments on time for the next 60 months. 

When this time comes to an end the remainder of your unsecured debts are written off. You are officially debt free! 

 

If you are struggling with Debt, would you like to speak to a specialist to discuss what options you have?

We work with Money Advisor who is able to help you, if meet the following 2 criteria:

1 – Your level of debt is £2,000 or over

2 – You have at least two creditors (ie two or more companies you owe money to)

If you meet the criteria, and would like some help, you can contact us in one of 2 ways:

  • Option 1 – Call us directly on – 0333 567 1613
  • Option 2 – Leave us your contact details and we will get in touch with you

 

Option 1 – Call directly to book an appointment with a debt management specialist

Our lines are open Monday to Friday – 9:00 to 8:00pm

Option 3 – Leave us your details and we will get in touch

Leave your contact details below and one of the Money Advisor team will give you a call to discuss your needs.

Please note that all calls are undertaken by Money Advisor who help thousands of individuals find solutions to get out of debt and. They can help you understand all the possible options and guide you through the various processes.

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