Clear, upfront answers about what an IVA will cost
Fees are one of the first things people ask about, and they deserve a straight answer. Contacting IndividualVoluntaryArrangements.net costs nothing, and there's no obligation. If an IVA is right for you, we'll explain how the Insolvency Practitioner's fees work, when they're taken and how they affect what your creditors receive, all before you commit to anything.
In most IVAs you don't pay anything upfront. Fees come out of your agreed monthly payment rather than on top of it, and every fee must be set out in your proposal before your creditors vote.
What we make clear from the start
- That your enquiry and first conversation are free
- How fees are taken and why they don't increase your monthly payment
- Which free alternatives you might qualify for
IVA fees are normally taken from the monthly payments you make into your IVA. That means you don't pay any extra on top of your agreed contribution, but it does reduce the amount your creditors receive.
What fees are charged?
Most IVAs involve two main types of fee, both paid to the Insolvency Practitioner:
| Fee | What it covers | When it's paid |
|---|---|---|
| Nominee fee | Assessing your situation, preparing your proposal and putting it to your creditors. | Usually from your first few monthly payments after the IVA is approved. |
| Supervisor fee | Running the IVA: collecting payments, paying creditors, annual reviews and dealing with any changes. | Spread across the life of the IVA, often as a percentage of the money collected. |
| Disbursements | Costs such as insurance (a bond), registration and any legal or property valuation costs. | Taken from the funds in the IVA. |
The exact fees must be set out in your proposal before your creditors vote, and creditors can challenge them. Most consumer IVAs follow the IVA Protocol, an industry framework that standardises how straightforward IVAs are run.
Do I pay IVA fees upfront?
Usually not. In most cases you won't pay anything until your IVA is approved, and then the fees come out of your agreed monthly payment. Be cautious of any firm asking for a large upfront payment before your IVA is in place.
How do fees affect what I repay?
Your monthly payment is based on what you can afford, not on the size of the fees. The fees are deducted from the total you pay in, and creditors share what's left. That's why the amount your creditors receive is lower than the total you pay over the term.
Example: if you pay £150 a month for 60 months, you pay £9,000 in total. If fees and costs come to, say, £2,500, your creditors would share around £6,500. The illustration is simplified; your proposal will show your actual figures.
What if my IVA fails?
If your IVA fails, fees that have already been paid from your contributions are not usually refunded. That's one reason to make sure an IVA is affordable and right for you before you start. See what happens if an IVA fails.
Warning signs to look out for
- Pressure to sign up quickly, or being discouraged from looking at other options.
- Requests for upfront fees before your proposal goes to creditors.
- Promises that a fixed percentage of your debt will definitely be written off.
- No clear explanation of free alternatives such as Debt Relief Orders or free Debt Management Plans.
- A firm that won't confirm which licensed Insolvency Practitioner will be responsible for your IVA.
How to check an Insolvency Practitioner
Every IVA must be supervised by a licensed Insolvency Practitioner. You can check an IP's licence on the GOV.UK Find an insolvency practitioner service. Debt advice firms that recommend IVAs should also be authorised by the Financial Conduct Authority (FCA), which you can check on the FCA Register.
Is it free to talk to you about an IVA?
Yes. Sending an enquiry and talking through your situation with us costs nothing, and there's no obligation to go ahead. We won't ask you for money to discuss your options. If an IVA goes ahead, the Insolvency Practitioner's fees are paid from your monthly contributions under the terms of your proposal, which you'll see in full before anything is agreed.
How IVA costs compare with other debt solutions
| Solution | How it's paid for |
|---|---|
| IVA | Insolvency Practitioner fees taken from your monthly payments |
| Debt Management Plan | Free from some providers; others charge a monthly fee |
| Debt Relief Order | No fee |
| Bankruptcy | £680 application fee, plus possible income payments |
| Consolidation loan | Interest and any arrangement fees charged by the lender |
The cheapest option isn't always the best one. A free DMP that takes ten years may cost you far more in total than an IVA that ends after five. We'll help you compare the overall cost, not just the fees.
Can I pay off my IVA early?
In some cases, yes. If you come into money, or a family member is able to help, you may be able to make a lump-sum offer to settle your IVA early. Your supervisor puts the offer to your creditors, who vote on whether to accept it. If they agree, the IVA ends and the remaining included debt is written off. Fees still apply to the work done, but finishing early can reduce the total amount you pay. We can explain how this might work for you.
Questions to ask about IVA fees
Whoever you speak to about an IVA, these questions will help you understand exactly what you're paying for:
- Which licensed Insolvency Practitioner will be responsible for my IVA?
- What are the nominee and supervisor fees, and when are they taken?
- Roughly how much of my total payments will go to creditors?
- Are there extra costs for a property valuation or equity release?
- What happens to fees already paid if my IVA ends early?
We're happy to go through any of these with you. Use the form at the top of the page to send your enquiry and choose a time to talk.