Initial IVA Assessment - What to Expect in Your First Consultation

Initial IVA Assessment - Your First Step

Your initial IVA assessment is the foundation of the entire process. It's where you'll discuss your financial situation in detail, determine if an IVA is suitable, and begin planning your debt solution. This typically takes 45-90 minutes and can be done face-to-face, by phone, or online.

Before Your Assessment - What to Gather

Essential Documents

Income evidence:

  • ✅ Last 3 months of payslips (employed)
  • ✅ Last 3 months of bank statements
  • ✅ Benefit award letters (Universal Credit, PIP, etc.)
  • ✅ Self-employment accounts (if applicable)
  • ✅ Pension statements
  • ✅ Rental income evidence

Debt information:

  • ✅ Recent credit card statements
  • ✅ Loan agreements
  • ✅ Overdraft limits
  • ✅ Store card statements
  • ✅ CCJ documentation
  • ✅ Correspondence from creditors

Expense information:

  • ✅ Mortgage statement or tenancy agreement
  • ✅ Council tax bill
  • ✅ Utility bills (gas, electric, water)
  • ✅ Insurance policies (home, contents, life)
  • ✅ Childcare costs
  • ✅ Transport costs (fuel, public transport)

Asset information:

  • ✅ Property deeds or mortgage statement
  • ✅ Vehicle registration (if owned)
  • ✅ Pension statements
  • ✅ Investment statements

Information You'll Need

Personal details:

  • Full name and date of birth
  • Current address (6+ months residence)
  • Employment status and employer details
  • Marital status
  • Dependents (children and ages)
  • National Insurance number

Financial snapshot:

  • Total debt amount (approximate is fine)
  • Number of creditors
  • Monthly income (all sources)
  • Monthly expenses (estimates okay)
  • Assets owned
  • Previous debt solutions attempted

The Assessment Process - Step by Step

1. Initial Contact (5-10 minutes)

What happens:

  • Debt advisor introduces themselves
  • Explains the assessment process
  • Asks for basic information
  • Explains confidentiality and data protection

Typical questions:

  • "What has prompted you to seek help today?"
  • "How much debt do you have approximately?"
  • "Are creditors taking legal action?"
  • "Have you tried other debt solutions?"

2. Income Assessment (15-20 minutes)

What they'll ask about:

Employment income:

  • Gross monthly salary
  • Net take-home pay
  • Overtime (regular or occasional)
  • Bonuses
  • Commission

Benefits:

  • Universal Credit
  • Disability benefits (PIP, DLA)
  • Child benefit
  • Working tax credits
  • Housing benefit
  • Pension credit

Other income:

  • Self-employment profit
  • Rental income
  • Pension income
  • Maintenance/child support received
  • Regular gifts from family

Example assessment:

Employment: £1,800/month net
Child benefit: £180/month (2 children)
Total household income: £1,980/month

3. Expenditure Assessment (20-30 minutes)

They'll go through every expense category:

Housing:

  • Mortgage/rent
  • Ground rent
  • Service charges
  • Buildings insurance
  • Contents insurance

Utilities:

  • Gas
  • Electricity
  • Water/sewage
  • Council tax

Food and housekeeping:

  • Food shopping
  • Toiletries
  • Cleaning products
  • Pet food

Transport:

  • Fuel
  • Public transport
  • Vehicle insurance
  • Road tax
  • MOT/servicing
  • Parking

Communications:

  • Mobile phone
  • Landline
  • Internet/TV packages

Personal:

  • Clothing
  • Haircuts
  • School costs
  • Childcare
  • Prescriptions

The advisor will:

  • Compare your figures to guidelines
  • Question anything unusually high or low
  • Suggest adjustments if needed
  • Ensure you have adequate budget

Typical guidance (Office for National Statistics and Insolvency Service guidelines):

  • Food (couple, 2 children): £500-600/month
  • Transport (car owner): £150-300/month
  • Clothing: £50-100/month per person

4. Debt Assessment (10-15 minutes)

For each debt, they'll ask:

  • Creditor name
  • Account/reference number
  • Original amount borrowed
  • Current balance
  • Monthly payment (if paying)
  • Arrears (if any)
  • Legal action status

Types of debt covered:

Typically included in IVA:

  • ✅ Credit cards
  • ✅ Personal loans
  • ✅ Overdrafts
  • ✅ Store cards
  • ✅ Catalogues
  • ✅ Payday loans
  • ✅ Council tax arrears
  • ✅ Utility arrears
  • ✅ CCJs

Usually excluded from IVA:

  • ❌ Secured loans (mortgage)
  • ❌ Court fines
  • ❌ Magistrates court fines
  • ❌ Student loans
  • ❌ CSA/CMS arrears
  • ❌ TV license arrears
  • ❌ Parking fines

Example debt list:

Credit Card A: £8,500
Credit Card B: £4,200
Personal Loan: £6,800
Overdraft: £1,500
Catalogue: £950
Council tax arrears: £1,200
Total qualifying debt: £23,150

5. Asset Assessment (10 minutes)

Property:

  • Do you own your home?
  • Property value (estimate)
  • Mortgage balance
  • Joint ownership?
  • Equity amount

Vehicles:

  • Do you own a car?
  • Make, model, year
  • Approximate value
  • Finance outstanding?
  • Essential for work?

Other assets:

  • Savings (usually excluded up to £500)
  • Investments/shares
  • Second properties
  • High-value items (jewelry, collections)
  • Pensions

What they're assessing:

  • Are assets reasonable?
  • Will they need to be sold?
  • Equity to consider for release

6. Suitability Discussion (10-15 minutes)

The advisor will consider:

IVA suitability factors:

  • ✅ Debt level £6,000+
  • ✅ Regular income
  • ✅ Affordable contribution (£80-100+/month)
  • ✅ 2+ creditors
  • ✅ Live in England, Wales, or NI
  • ✅ Over 18
  • ✅ Likely to get 75% creditor approval
  • ✅ Not currently bankrupt

Red flags for IVA:

  • ❌ Income too irregular
  • ❌ Can't afford minimum payment
  • ❌ Already facing bankruptcy petition
  • ❌ Debts mainly secured or priority
  • ❌ Unlikely to get creditor approval

They'll explain:

  • Whether IVA is suitable
  • Why or why not
  • Alternative solutions if not suitable
  • Next steps if proceeding

7. Alternative Solutions Discussed (If Relevant)

If IVA not suitable, they may suggest:

Debt Management Plan (DMP):

  • If income irregular
  • If prefer flexibility
  • If debt under £6,000

Debt Relief Order (DRO):

  • If debt under £30,000
  • If disposable income under £75/month
  • If assets under £2,000

Bankruptcy:

  • If assets to protect not a concern
  • If need fast debt relief
  • If creditor pressure intense

Full and Final Settlement:

  • If lump sum available
  • If creditors may accept less

Breathing Space (Debt Respite Scheme):

  • If need time to decide
  • 60 days of protection
  • No interest or enforcement

8. IVA Payment Calculation

If IVA is suitable:

Disposable income calculation:

Total monthly income: £1,980
Total monthly expenses: -£1,700
Disposable income: £280/month

Proposed IVA payment: £280/month
Over 60 months: £16,800 total
Plus equity release (if homeowner): TBC year 5

Payment levels:

  • £80-150: Low payment IVA (minimum viability)
  • £150-300: Average IVA payment
  • £300-500: High payment IVA
  • £500+: Very high payment (creditors more likely to approve)

9. Fee Disclosure

They must explain:

  • Nominee fee: £1,000-£2,000 typically
  • Supervisor fee: 15-20% of contributions
  • When fees are taken
  • How much creditors receive

Example fee breakdown:

Total contributions: £16,800 (60 months × £280)
Nominee fee: £1,500
Supervisor fee (18%): £3,024
Total fees: £4,524 (27%)
To creditors: £12,276 (73%)

10. Questions and Next Steps (5-10 minutes)

Your opportunity to ask:

  • Anything unclear
  • Concerns about process
  • Impact on your situation
  • Timeline questions
  • Alternative options

If proceeding with IVA:

  • Schedule proposal appointment
  • Receive document checklist
  • Given time to consider (no pressure)
  • Contact details provided
  • Next appointment booked

Cooling-off period:

  • You're not committed after assessment
  • Can take time to decide
  • Can seek second opinion
  • Can change your mind

Assessment Locations

Face-to-Face Assessment

Where:

  • IP's office
  • Your home (if offered)
  • Neutral location (rare)

Advantages:

  • Personal connection
  • Can show documents easily
  • Ask questions naturally

Disadvantages:

  • Need to travel
  • May need time off work
  • Less convenient

Telephone Assessment

How it works:

  • Scheduled call
  • 60-90 minutes
  • Documents emailed beforehand

Advantages:

  • ✅ No travel needed
  • ✅ More convenient
  • ✅ Can do from home
  • ✅ Access to documents during call

Disadvantages:

  • Harder to show documents
  • Can feel impersonal
  • May need to scan documents

Online/Video Assessment

Platforms used:

  • Zoom
  • Microsoft Teams
  • Other video platforms

Advantages:

  • ✅ See advisor face-to-face
  • ✅ Share screen for documents
  • ✅ Convenient
  • ✅ Can record (with permission)

Disadvantages:

  • Need good internet
  • Technology issues possible
  • May feel uncomfortable on camera

What Happens After Assessment

If IVA is Recommended

Next steps:

  1. You receive summary of discussion
  2. Consider the proposal
  3. Decide if you want to proceed
  4. If yes: Schedule proposal preparation meeting
  5. Begin gathering detailed documentation
  6. Proposal preparation begins

Timeline: Usually proceed within 1-2 weeks if decided

If IVA is Not Suitable

You'll receive:

  • Explanation why not suitable
  • Alternative solution recommendations
  • Referrals to appropriate services
  • Action plan

Common alternatives suggested:

  • DMP providers
  • DRO eligibility assessment
  • Bankruptcy advice
  • Budgeting support services

If You Need Time to Decide

That's completely normal:

  • No pressure to decide immediately
  • Can take days/weeks to consider
  • Can seek second opinion
  • Can contact them with questions

While deciding:

  • Review the assessment summary
  • Discuss with family if appropriate
  • Research IVA consequences
  • Use IVA calculators
  • Seek free debt advice (StepChange, etc.)

Red Flags During Assessment

Pressure Tactics (Warning Signs)

Be wary if advisor:

  • Pressures you to decide immediately
  • Doesn't explain alternatives
  • Minimizes IVA consequences
  • Promises unrealistic write-offs
  • Asks for upfront fees
  • Won't give you time to consider

Legitimate IPs will:

  • Explain all options
  • Give time to decide
  • Be transparent about fees
  • Discuss consequences honestly
  • Provide written information
  • Never pressure you

High-Pressure Questions to Watch For

  • "Can you pay the first fee today?"
  • "If you don't proceed now, your situation will get worse"
  • "This is the only solution for you"
  • "Don't bother getting a second opinion"

Your right: Walk away from high-pressure situations

Questions to Ask During Assessment

About the IVA

  • "Am I definitely suitable for an IVA?"
  • "What are the alternatives?"
  • "What percentage of my debt will be written off?"
  • "What if my circumstances change?"
  • "Can the IVA fail? What happens then?"

About Fees

  • "What are your total fees?"
  • "When are fees taken?"
  • "How much will creditors receive?"
  • "Are there any hidden costs?"
  • "What if I can't afford the payments?"

About Process

  • "How long until creditors are contacted?"
  • "When will creditor pressure stop?"
  • "How long until the IVA is approved?"
  • "What happens at the creditors' meeting?"
  • "Who will be my main contact?"

About Your Situation

  • "Will I lose my home?"
  • "Can I keep my car?"
  • "Will my employer find out?"
  • "Can I go on holiday?"
  • "What if I get a pay rise?"

Preparing Mentally for Assessment

Common Feelings

Before assessment:

  • Anxious about discussing debts
  • Embarrassed about situation
  • Worried about judgment
  • Overwhelmed by process
  • Hopeful for solution

These feelings are normal

What to Remember

The advisor:

  • Has seen it all before
  • Won't judge you
  • Wants to help
  • Deals with debt daily
  • Understands it's difficult

Your situation:

  • Is not unique
  • Can be resolved
  • Has happened to many people
  • Doesn't define you
  • Has a way forward

Tips for a Productive Assessment

  1. Be honest: Don't hide debts or income
  2. Have documentation ready: Speeds up process
  3. Ask questions: No question is stupid
  4. Take notes: Write down important information
  5. Bring partner if joint debts: Get both perspectives
  6. Don't be embarrassed: They're there to help
  7. Be realistic about expenses: Honesty helps planning

Cost of Initial Assessment

Usually Free

Initial assessment typically costs:

  • £0 (free)
  • No obligation
  • No upfront payment
  • No commitment required

Fees only charged if:

  • You decide to proceed with IVA
  • Proposal is prepared
  • IVA is approved and begins

Be wary of:

  • Companies charging for assessment
  • Upfront fees before IVA approval
  • "Administration fees" before proceeding

After the Assessment - Decision Time

Take Time to Decide

Do your research:

  • Read IVA consequences
  • Use online calculators
  • Read reviews of IP company
  • Seek second opinion if unsure
  • Discuss with family

Consider:

  • Can you afford payments for 5-6 years?
  • Is debt write-off worth the consequences?
  • Are alternatives more suitable?
  • Do you trust the advisor?
  • Is the company reputable?

Getting a Second Opinion

Completely acceptable to:

  • Seek assessment from another IP
  • Contact free debt charities (StepChange, National Debtline)
  • Compare IVA proposals
  • Take your time

Free debt advice:

  • StepChange: 0800 138 1111
  • National Debtline: 0808 808 4000
  • Citizens Advice: Local office
  • Money Helper: 0800 138 7777

Summary

Your initial IVA assessment:

  • ✅ Usually free
  • ✅ Takes 45-90 minutes
  • ✅ Can be done phone/video/face-to-face
  • ✅ Covers income, expenses, debts, assets
  • ✅ Determines IVA suitability
  • ✅ No obligation to proceed
  • ✅ Should be pressure-free

After assessment:

  • Take time to decide
  • Research thoroughly
  • Seek second opinion if needed
  • Proceed only when comfortable

If proceeding: Next step is choosing your Insolvency Practitioner and beginning proposal preparation

Ready to explore?

Back to IVA Process Overview