How to Choose an IVA Provider Safely

Start with free advice, not a sales call

The safest first step is impartial advice from a charity that earns nothing if you choose an IVA. StepChangeStepChange Explained: What It Does and How It WorksWhat the debt charity StepChange offers, how its free debt advice and debt management plans work, who it suits and what to expect when you contact them.Read more →, National DebtlineNational Debtline: How It Works, When to CallWhat National Debtline is, who runs it, what it can help with, how to get free advice by phone, webchat or online tools, and what to expect.Read more → and Citizens Advice can look at your finances and tell you whether an IVA is realistic or whether a debt management planDebt Management Plan (DMP)A Debt Management Plan is an informal arrangement to repay unsecured debts at a monthly rate you can afford. Learn how DMPs work, who they suit and what to consider.Read more →, Debt Relief OrderDebt Relief Order (DRO)A Debt Relief Order is a formal solution for people with low income, low debt and few assets. Learn how DROs work, eligibility criteria and what happens to your debts.Read more → or bankruptcyBankruptcyBankruptcy is a legal process that writes off most debts when you cannot repay them. Understand how bankruptcy works in the UK, the consequences and alternatives.Read more → would suit you better. Going to a provider first means you hear about the option it sells. See free debt advice in the UK for how to contact them.

What a legitimate provider must be

In an IVA, the person who runs your case must be a licensed insolvency practitioner. GOV.UK states that you must use an insolvency practitioner to arrange an IVA. Licensing is carried out by recognised professional bodies, and the Insolvency Service oversees the system. A business may also need to be authorised by the Financial Conduct Authority for the debt advice it gives. You can check authorisation on the FCA Register and ask the practitioner which body licenses them.

Questions to ask every provider

Ask the same questions of at least two providers, and write down the answers.

• Who is the licensed practitioner and which body licenses them?
• What is the total of all fees over the full term, including set-up and ongoing handling?
• How much of each payment goes to fees, and how much to creditors?
• Do you pay or receive a fee for referring me?
• What are the exact terms on my home, savings and other assets?
• What happens if I miss a payment or lose my job?
• Can I leave, and what will it cost?

Red flags

1. Cold calls or text messages offering to wipe your debts.
2. Promises of results before they have seen your income and debts.
3. Vague fees or refusal to put them in writing.
4. Advice to stop paying creditors without explaining the risks.
5. Fees charged upfront before any work is done.
6. No mention of alternatives, such as free options.
7. Slick websites that do not name the practitioner or their licensing body.

How to compare two providers fairly

Create a simple table. For each provider, note the total fees, the total amount you would pay, the amount creditorsHow to Deal with Creditors: Communication and NegotiationPractical advice on communicating with creditors, negotiating affordable repayments, and understanding your rights when dealing with the companies you owe.Read more → would receive, the length of the arrangement and the terms about your home. Then compare the cost per pound of debt cleared. Do not be swayed by a low monthly payment alone, because a long term and high fees could cost more overall. See our guide to IVA costs and fees for how fees work.

Check complaints and reviews carefully

Reviews can help, but they can also be selected or incentivised. Look for patterns rather than single comments, and note how the company responds to complaints. Ask the provider how to complain and which body would handle it. If something goes wrong, our guide to mis-sold IVAs explains the routes.

Why MoneyBrink does not rank providers

This site is funded by advertising, not by product sales or referral fees, and we never offer or sell financial products. We therefore do not recommend or list IVA companies. That keeps our guides independent, but it also means you should apply the checks above before you trust any provider, including those that advertise on the web.

After you choose

Read the proposal carefully before it goes to creditors. Make sure it matches what you were told. Keep copies of everything. Attend annual reviews, tell the practitioner about any change in circumstances and make every payment on time. For the wider picture of what to expect, read our guide on the Individual Voluntary Arrangement.

A worked comparison

Suppose two providers quote for the same case. Provider A has a lower monthly payment but a longer term and higher total fees. Provider B has a slightly higher payment, a shorter term and lower fees, so more of your money reaches creditors. A quick calculation of total paid, total fees and the amount going to creditors shows B is better value even though the monthly figure looks worse. Without the comparison, it is easy to choose the cheaper-looking monthly option and pay more overall. The numbers are made up, but the method is real.

Before you sign

Read the proposal in full. Make sure the figures match what you were told, that the terms about your home and assets are clear and that you understand how to leave or complain. Ask someone you trust or a free adviser to read it too. If you are given a cooling-off period, use it.

Keeping control of the process

You are in charge of the decision. Take your time, ask for everything in writing and compare at least two quotes. Do not allow anyone to contact your creditors on your behalf until you have chosen and signed. If you change your mind after the proposal is drawn up, ask what it would cost to stop. Remember that you can always walk away and get a second opinion from a free adviser.