An Individual Voluntary Arrangement (IVA) is a debt solution that could help you deal with unaffordable debt and potentially stop bailiffs. Whether you've already entered into an IVA or you're just considering it, it's important to know how it could affect both existing and future debt enforcement action.
Find out if your debts qualify
Check my eligibilityHow does an IVA work?
An Individual Voluntary Arrangement (IVA) is a legally binding agreement available in England, Wales, and Northern Ireland. It is a legally binding agreement between you and your creditors to repay your debt in one affordable monthly payment based on your financial situation.
They can only be set up and managed by a licensed Insolvency Practitioner (IP), who is a legally qualified and regulated professional authorised to manage the financial affairs of insolvent individuals. They will review your financial circumstances and create an IVA proposal for your creditors to sign.
As long as the majority of your creditors (75% of debt value) vote to accept the IVA agreement, your arrangement will commence. Once you've gained creditor approval, your IVA will be approved.
Most IVAs last five years. During this time, you'll have legal protection from the people you owe money to. This means that they won't be able to contact you, add interest and fees, or pursue legal action against you as long as you make regular repayments towards the debt.
Once you've completed an IVA, all the included debts will be written off, and you'll be free to move forward financially.
Only unsecured debts can be included in an IVA. This includes payday loans, personal loans, utility arrears, credit cards, overdrafts, catalogues, and council tax arrears. Most secured debts are generally excluded from an IVA, such as mortgages, student loans, criminal fines, child maintenance arrears, and car finance.
Can an IVA stop bailiffs immediately?
One of the benefits of an IVA is that it can put an immediate stop to all legal action, including visits from County Court and High Court enforcement officers. Even if a bailiff has already visited you, they cannot return after the IVA is legally in place.
However, it's important to note that it can take around four to six weeks from your initial consultation for your IVA to be finalised. During this time, your creditors will be free to contact you and may initiate legal proceedings against you.
It can also take some time for bailiffs to respond to the IVA and stop contacting or visiting you, and you can still be visited about other debts not included in the IVA. For example, if you have an IVA but have secured debts, bailiffs may still visit you about them.
In extreme circumstances, you may be able to apply for Breathing Space to get immediate protection from your creditors while your IVA is being set up.
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I'm facing bailiff action. What are my options?
If you're facing bailiff action, it's important not to panic. Here are some steps you should take to protect yourself:
Secure your home
It might surprise you to learn that, when a County Court bailiff visits your home, you do not need to let them inside. They also cannot force entry into your home on their first visit for a civil debt and must gain peaceful entry through an unlocked door or by being invited in.
You must ask for proof of identity when they visit you, but this can be done through a closed door. Request their ID, the name of the company they work for, and a breakdown of what you owe.
Learn your rights
Most people assume that bailiffs always operate within the confines of the law, but unfortunately, this isn't always the case. Understanding your rights can help you identify when you're being treated unfairly.
For example, bailiffs are prohibited from seizing essential items you need to maintain a basic standard of living (e.g. clothes, bedding, or kitchen appliances), tools needed for work or education up to a value of £1,350, and items belonging to anyone else in the household. They are also only legally allowed to visit between the hours of 6am and 9pm and must be able to provide details of the debt when requested, including any court documents.
If bailiffs break any of these rules, you have the right to complain to the company they work for.
Negotiate a repayment plan
If you can afford to pay anything towards the debt, it's worth making a written offer to the bailiff when they visit you - even if you're offering reduced payments.
You'll always be given at least seven days' notice before bailiffs visit you, so you should have enough time to work out how much you can realistically afford to pay towards the debt.
Seek expert debt advice
If you've received a notice of enforcement, seeking free debt advice can help you know what your next steps should be. Whether you agree to owing the debt or plan to dispute it, reaching out to a debt help company or charity is recommended.
Some services may be able to create a budget that works for you, offer practical guidance going forward, and even negotiate a manageable payment plan on your behalf.
Can bailiffs force entry?
If a bailiff is collecting payment for a civil debt and it is the first time they are visiting your home, they cannot force entry to your home under any circumstances.
However, there are some situations in which bailiffs can use force to gain entry, which we've outlined below:
If you've broken a controlled goods agreement
When a bailiff first visits you, they may agree to a controlled goods agreement, which is where they agree to let you keep your belongings in exchange for you making regular payments towards the debt.
If you break the terms of a controlled goods agreement (e.g. by not making payments as originally agreed), bailiffs have the right to force entry when they return.
If they're collecting certain debts
If a bailiff is visiting you to collect Magistrates Court fines (e.g. unpaid criminal fines) or HMRC debts (e.g. income tax debts), they are allowed to use force.
They're not allowed to break your door down, but they may return with a locksmith to unlock the door for them. Any costs incurred during this process will be added to your total debt level.
If your home is being repossessed
If a bailiff has a warrant from the court to repossess your home, they can force entry into the property if you refuse to grant them entry or you refuse to leave the premises when asked.
They will usually attend with a locksmith, remove you from the property, and change the locks. However, if the situation escalates to this stage, you'll likely be charged bailiff fees to cover the additional time and resources used.
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Do I still need to pay bailiffs after my IVA has been approved?
Bailiffs shouldn't contact you after your creditors vote to approve your IVA, as you should be protected from any further legal action. If bailiffs do need to get in touch with you at any point during your arrangement, they should contact your IP, who will act as a middleman between you and the creditors included in the arrangement.
If bailiffs continue to contact you or visit you after your IVA has been approved, it's important that you do not let them in. Simply provide a copy of your IVA documentation to prove that your agreement has been finalised, or give them the contact details of your IP. This should de-escalate the situation, but if bailiffs refuse to leave or proceed to seize your belongings, contact your IP immediately or seek legal advice.
What other debt solutions can stop bailiffs?
Entering into any formal debt solution will put a stop to any existing or future bailiff action. Here are some other debt solutions that you might qualify for:
Bankruptcy
Bankruptcy is a legal process designed to help individuals in England, Wales, and Northern Ireland who can't repay their debts. It costs £680 to file for bankruptcy, which must be paid in full before you submit your application, although this can be paid in instalments.
Bankruptcy is often viewed as a last resort due to the negative impact it can have on your finances and, specifically, your credit score. It gives you a period of relief from all included debts for 12 months. If your financial situation doesn't improve after this time, the included debts will be written off.
During a bankruptcy period, creditors will be instructed not to contact you or take legal action against you to recover the money owed.
Debt Relief Order (DRO)
A Debt Relief Order (DRO) is a legally binding debt solution available in England, Wales, and Northern Ireland. It's often viewed as a low-cost alternative to bankruptcy, as there is no application fee.
DROs are primarily designed for individuals with low incomes and few assets. It works by giving you a temporary period of relief from all included debts for 12 months (known as a moratorium period). If your financial situation doesn't improve after 12 months, the included debts will be written off.
Because a DRO is a formal debt solution, your creditors can't contact you or take further legal action against you for the duration of the arrangement. This includes issuing you with a County Court Judgment (CCJ).
Protected Trust Deed
A Protected Trust Deed is a formal debt solution available in Scotland. It's sometimes referred to as the Scottish version of an IVA, as it works in a similar way.
Protected Trust Deeds typically last four years. During this time, you'll make one monthly payment towards your debts. Once you complete the agreed term, any remaining debt included in the arrangement will be written off.
A Protected Trust Deed can stop bailiff action as you'll be protected from further action from the moment your arrangement is approved.
Other debt solutions, such as a Debt Management Plan (DMP) and debt consolidation, can help you deal with your debts, but they won't legally stop bailiffs. For more information about which debt solutions can stop bailiffs, don't hesitate to seek professional debt advice.
Conclusion
Entering into a formal debt solution like an Individual Voluntary Arrangement (IVA) should put a stop to any bailiff visits, as all legal action will stop from the date your arrangement begins.
An IVA can be used to deal with most debts, including unsecured loans, council tax debt, overdrafts, utility arrears, catalogues, and credit cards. Secured debts, unpaid court fines, mortgages, student loans, criminal fines, child maintenance arrears, and car finance.
If you've received a notice of enforcement, seek urgent debt advice from a debt advisor or charity. It's important to be aware of your rights when facing bailiff action so you can recognise when you're being treated unfairly.
