Individual Voluntary Arrangement vs Debt Relief Order
Individual Voluntary Arrangement against Debt Relief Order on duration, cost, your home, your credit file and what gets written off. An honest comparison, with the risks of both.
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The comparison in full
| Individual Voluntary Arrangement | Debt Relief Order | |
|---|---|---|
| Legally binding on creditors | Legally binding on included creditors | Full protection, then write-off |
| Duration | 60 months, or 72 with home equity | 12 months |
| What you pay | Monthly, affordability-based | No payments at all |
| Cost to you | Paid from your monthly payments | Free — no application fee |
| Your home | Excluded; equity sets the term | Not available to homeowners |
| Credit file | 6 years from the start date | 6 years from the order date |
| Public record | Yes — Listed on the public Individual Insolvency Register, which anyone can search. Your address can be withheld only on evidenced safety grounds. | Yes — Listed on the public Individual Insolvency Register. |
| Debt written off | Yes, at the end of the term | Yes, at the end of the term |
| Where it applies | England, Wales and Northern Ireland | England and Wales (Northern Ireland has its own version with different thresholds) |
When Individual Voluntary Arrangement is the better fit
People with multiple unsecured debts, a reliable monthly surplus, and often assets or a home they want to protect. The 2025 IVA Protocol indicates typical suitability includes several debts totalling around £7,000 or more, and not being eligible for a DRO.
When Debt Relief Order is the better fit
People on a low income with few assets and no realistic prospect of repaying. You must apply through an approved intermediary — usually a free debt advice charity. You cannot apply directly.
The verdict
This is not really a choice, it is a test. Check DRO eligibility first, through a free adviser who can act as an approved intermediary. Only if you fall outside those limits does the IVA question arise. Any firm that recommends a fee-paying IVA without establishing whether you were DRO-eligible has not done its job.
Risks on both sides
- If you stop being able to pay, the IVA can fail. Interest and charges can be added back on and creditors may petition for your bankruptcy.
- Fees reduce what your creditors receive, so more of your payment goes to costs than in a free Debt Management Plan.
- It is a public record for the duration.
- Holding £10,000 or more of beneficial interest in a family home means a 72-month term rather than 60.
- Some debts cannot be included — student loans, court fines, child maintenance and secured debts among them.
- The thresholds are strict and absolute. Go over any one of them and you are ineligible.
- If your circumstances improve during the 12 months, the order can be revoked and the debts come back.
- It is a public record.
- You cannot get another DRO for 6 years.
Still weighing these two up?
Answer eight questions and we will show you which framework applies where you live and which routes fit the shape of your finances. It is not an eligibility check — it is a shortcut to the right reading.
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