Compare IVA and debt management- helps you know the difference

People always debate on benefits and disadvantages of IVA and Debt Management, as both options are effective in their own way to clear your debts. But before taking any decision it is necessary to clearly understand both these options.

What is debt management?
This is a plan that can help you in managing your unpaid debts. This valuable arrangement offers you various programs within a widespread package to work for even inflexible targets.

What is IVA?
This is a legal binding between you and your creditor, which is set up by a Licensed Insolvency Practitioner. This is considered to be the alternative of bankruptcy, so as to pay off all debts and have a debt free life. It includes the government approved method of repaying arrears that can avoid the cost of bankruptcy.

Comparison between Debt Management and IVA:
The main difference them is that it differs from the situations faced by different people. The main idea behind an IVA and debt management is to make you debt free.

In debt management, an agreement is made with your creditors with lower affordable monthly repayments. This plan has no legal binding; it is only based on the mutual understanding of both the debtor and the creditor. This scheme also offers you the option to go for the secured debt consolidation loan. It means you have taken a new debt to pay off your old multiple arrears. However, this loan has a collateral section which can lead to losing the property if you are unable to repay the amount on time.

On the other hand, IVA is a legally binding agreement between you and your creditor. In this you need not take any new loan, you just have to make monthly installments. These monthly payments are calculated only after considering your debt load, income and expenditure.

In an IVA facility, the repayment period is for five years; the debtor is declared debt free after the period of five years. Whereas in debt management it can take you longer to repay as it does not have any fixed end date.


The best alternative for you will depend on your income and debt burden. If you still can’t make your mind and need more assistance on debt management and IVA, then just go online without any hesitation. Just fill a simple application form on a website which will provide information, this will enable you to get help from experts.