IVA Help

When people are looking for Individual Voluntary Arrangement (IVA) help they often seek a Joint IVA.

A Joint IVA is essentially two IVAs based on a common financial statement. A Joint IVA allows two people with shared living costs and shared debts the ability to propose an IVA together.

They can often be referred to as Interlocking IVAs as well.

When a Joint IVA is proposed there is a sizable savings in the cost compared to two single IVA applications.

This is the main reason they have become quite popular in recent years. Due to the reduction in costs, Joint IVAs will sometimes allow IVAs to be proposed that would otherwise not be economically viable if they had to stand on their own.

A Joint IVA is most common for couples that share the same budget and debt trouble who find that they no longer can afford to pay their joint debt. Many people think that a Joint IVA is only for a wife and husband. This is a common misconception.

Joint IVAs can exist between any 2 people with a shared budget (flatmates etc.)

It is also essential to note that Joint IVAs are completely dependent on each other. If one of the IVAs ends up failing then there is a very strong likelihood that the remaining IVA will also fail. This is not always the case.

Because of this, most Joint IVAs are between couples as a couple (especially a married couple) will often have a greater incentive to successfully complete the IVA together whereas that might not be the case, for example, with 2 flat mates sharing rent.

If the two parties separate and the IVA has an equity release provision, there will be issues about the proceeds from the sale of a jointly owned residence. This can get quite complicated. Couples go through regular reviews as part of the IVA process and if either starts earning more money then their IVA repayments may increase. This is the same with other IVAs.

In a Joint IVA, the Insolvency Practitioner will be able to decrease the costs because the data required will be common to both of the IVAs. In actuality, they are still two separate IVAs on the IVA register but they are treated in a joint manner from an administrative point of view.

The administrative cost of a Joint IVA is usually less than two single IVAs. In a Joint IVA, the total debt must be a minimum of £20,000 thus splitting down to £10,000 for each person. Otherwise a single IVA is taken out and the other partner manages the smaller portion of the debt.