By taking on an IVA, you’re entering into a legally-binding agreement with your creditors to make regular payments towards your debts. One of the most common ways that agreement can be put in jeopardy is IVA arrears. 



What are IVA arrears?



Much like if you were to miss a mortgage or rent payment and fall into arrears, IVA arrears is the name given to the situation where a client fails to make one or more monthly payments to their Individual Voluntary Arrangement.

Falling into arrears can put you at risk of breaching the agreement you signed up to with your creditors, which is why at Parkfield Insolvency we like to give clients as much leeway as possible to catch up with missed payments and get their IVA back on track. 

How do people fall into IVA arrears?



Arrears can be a sensitive issue. Although your creditors understandably expect you to make your IVA payments on time, you may have had a perfectly good reason for missing your last IVA payment. 

In our experience, reasons for missing an IVA payment often include:

• Poor mental health
• A family bereavement 
• Problems with your bank
• Being paid late by an employer

While your reason for falling into arrears will of course be taken into account, missing IVA payments can quickly become a problem. 



No matter how it is that you fall into IVA arrears, what’s most important is that you move on from your missed payment and work with us to help get your arrangement back on track. 

Who deals with IVA arrears at Parkfield Insolvency?

We have a dedicated arrears team here at Parkfield whose job it is to work with clients who, for one reason or another, have failed to meet the obligations they signed up to as part of their IVA. 

We understand that falling into arrears is a delicate situation, not just for the success of your arrangement, but also for you personally. 

That’s why our arrears team have the experience, training, and sensitivity necessary to get to the heart of your situation and help you plan a way forward. 

What should I do if I fall into IVA arrears?



Contact us

The first thing you should do when you miss an IVA payment is get in touch with the team at Parkfield.

Once you get in touch, we’ll pass you over to our arrears team. They handle all IVA arrears and will be able to help you get back on track by making a late payment, or get in touch with your Insolvency Practitioner to discuss your options. 

Make a late payment

When you get in touch with us and are passed to the arrears team, we will need to know why you missed your last IVA Payment. 

As long as you have a good reason for the delay, and are happy to make up for the payment you missed, we may be able to arrange for you to make a late payment. Late payments will be handled on a case-by-case basis.

Receiving a notice of breach

Anybody who misses an IVA payment is likely to receive a notice of breach from their Insolvency Practitioner. This is a document which outlines the way in which you have breached the terms of your arrangement. 

The breach notice will give you a detailed explanation of what you’ve done wrong, in this case missing an IVA payment, as well as steps to put it right, i.e. by making a late payment to settle your arrears. 

As long as you take the necessary steps to resolve the matter within the time frame set out in your breach notice, you should be able to get your IVA back on track.

What happens if I don’t catch up with my IVA arrears?



You will be presented with two main options if you fail to catch up with your IVA arrears:

• Adapting your IVA to fit your circumstances
• IVA failure and likely bankruptcy

If you continually fail to make your IVA payments, it may be the case that your payment level is too high. It might be possible to lower the level of your monthly contributions, subject to an income and expenditure check. 

Beyond that, continually missing payments will result in IVA failure. Your agreement will be terminated, and we will send you a notice of termination outlining why. 



Once your IVA fails, your creditors will be able to get back in touch with you to chase you for payments, and are also within their rights to appeal to the court to make you bankrupt in order to recover some of the money you owe. 

What if I want to terminate my IVA after falling into arrears?



You don’t have to continue with your Individual Voluntary Arrangement if you fall into arrears. After missing a number of IVA payments, you may decide you can’t foresee a situation where you would be able to continually meet your monthly contributions. 

In that scenario, it’s possible for you to reach out to your IVA supervisor – in this instance, Parkfield Insolvency – and request that your IVA be terminated. For your request to be official, you should send it in writing, and include any relevant information regarding the reason for the termination.

Even if you do terminate your IVA, however, it may take several months for it to be removed from the IVA register, and details of the arrangement will remain on your credit file for six years from its official start date.

More importantly, you will still have to pay your outstanding debts to creditors, and will no longer receive the creditor protection your IVA offered. That means not only will you have to pay back your remaining debt, creditors may backdate fees and charges on top of that debt.