One of the most common questions we get from clients who have entered an IVA is what happens if they miss a payment, and what they can do to get their arrangement back on track once they find themselves in that position. 



What are common reasons for missing IVA payments?



Even if you have completed an income and expenditure check and have agreed to make a certain level of contribution to your IVA each month, we understand financial emergencies happen. 

Occasionally events outside your control can cause you to fail to make your IVA payments on time. Common reasons for people missing IVA payments might include:

• Being paid late by your employers
• Encountering a problem with your bank
• A financial emergency like a boiler breakdown or urgent dental treatment

While you may have a very good reason for missing an IVA payment, it’s important to remember that your IVA is a legally-binding arrangement and failing to make your payments on time means you aren’t living up to your end of the bargain. 



It could eventually result in IVA failure.

What do I do if I miss an IVA payment?



Missing an IVA payment is a breach of your agreement. If you realise you have missed an IVA payment, or think you’re in danger of missing IVA payments in future, it’s important that you take action right away. 

Contact us

The first thing you should do when you miss an IVA payment is get in touch with the team at Creditfix. You can contact us 0800 047 8826. 



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 repay a missed payment?



There are three possible scenarios for a client who continually fails to meet their IVA payments, ending with possible bankruptcy. 

Changing the terms of your IVA

If your financial circumstances have changed and you no longer think you will be able to keep up with your IVA payments, it may be possible for us to work with your Insolvency Practitioner to change the terms of your arrangement and lower your monthly contributions. 

IVA failure

If you continually fail to make your IVA payments, your IVA will eventually fail. When your IVA fails the arrangement will end, meaning you won’t have to continue making payments.

That said, the money you originally owed still stands. Your creditors will be owed the remaining balance of the debts included in the IVA, and it’s your responsibility to arrange further payments towards your total debts if you want to avoid bankruptcy.

Bankruptcy

Because an IVA is a legally-binding agreement, it offers you protection from creditors harassing you for payments. When IVAs fail, that protection no longer exists. 



Creditors can resume contacting you, and even have the power to make you bankrupt straight away because you breached the agreement. Your IP also has the ability to make you bankrupt in this instance.