If you are insolvent then you may be limited on your Debt Solution options. Being insolvent means that you cannot afford to repay your debts, so IVA and Bankruptcy may be the only options.
Bankruptcy should only ever be considered as a last resort after all other debt solutions have been exhausted. IVA legislation was introduced by the Government so people could avoid declaring themselves bankrupt.
Below is just a short summary of the main differences, please call our advisors for more information on 0808 131 9103.
Are my details kept private?
IVA: Yes, an IVA is not advertised. Although details can be found on a government website. Only your creditors will be notified about your IVA.
Bankruptcy: No, all bankruptcy orders are advertised in your local newspaper. Everyone that you are financially connected with will be contacted.
Can I keep my business?
IVA: Yes you can still run your business and be a company director or in professional roles involving finance.
Bankruptcy: No, normally any business will be closed immediately.
Can i keep control of my assets?
IVA: Yes, some assets can be excluded from your proposal. Although you may have to release some equity from your home.
Bankruptcy: No, assets can be sold to raise money for your creditors, this includes your house. Any assets acquired during the bankruptcy term are also lost.
Can i keep my bank account?
IVA: Yes, although you may lose some extra facilities such as your overdraft.
Bankruptcy: No, all of your bank accounts, credit cards will be closed and any hire purchases cancelled.
Am i legally protected against my creditors?
IVA: Yes, no court proceedings can be brought against you once you have been accepted for an IVA. However, if you fail to keep up your monthly payments, then creditors may start bankruptcy proceedings against you.
Bankruptcy: No, your creditors may look to sell your assets and take any action they deem necessary against you.