One of the advantages often highlighted of using an Individual Voluntary Arrangement (IVA) is that it is a private agreement between you and your creditors.

This statement is correct in the sense that no-one will be specifically told about the Arrangement other than of course your creditors. Your employer, landlord, bank (if not a creditor) and friends and family will not be informed. As such it is unlikely that they will find out unless you choose to tell them.

However you need to be aware that once you have started the Arrangement anyone can find out that you have done so if they wish to by searching the Insolvency Register.

What is the Insolvency Register?

The Insolvency Register (sometimes referred to as the Bankruptcy register) is a list of everyone in England and Wales who is currently bankrupt or is in an IVA. As soon as your Arrangement is agreed your name is added to this register and will stay there until it is completed.

In a sense this does not mean that the Arrangement is advertised for all to see. It is not as if your name is highlighted in the local newspaper.

However, the insolvency register is publicly accessible via the internet and anyone who wants to can search on your name find out about your situation.

Is an IVA more private than Bankruptcy?

As a result of a change in the rules in 2009 Bankruptcy is no longer advertised in the local newspaper. Because of this in terms of privacy there is now far less of a difference between an IVA and going Bankrupt.

Both solution are the same in the sense that few people will be specifically told and with both your name is added to the insolvency register.

There are still some differences though. If you go Bankrupt your bank will be informed whether or not they are one of your creditors and you will definitely have to change your bank account. In addition if you are renting your landlord might also be informed of your situation.

BMD Tip: Once you have completed your IVA your details will be taken off the Insolvency Register. This is the same in Bankruptcy however with Bankruptcy your name is also recorded in the London Gazette archives and this will remain there forever.

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Should you start an IVA if you want total privacy?

At the end of the day an IVA is not a totally private solution because of the fact your name is added to the Insolvency Register. If you require total privacy then the only option to resolve your debt problem is to start a Debt Management Plan (DMP).

This is an informal agreement and as such you are not formally classed as being insolvent. For this reason your name is not added to the insolvency register and no one can find out that you have put the Plan in place unless you choose to tell them.

Clearly this is an advantage if you want total privacy. However it should not be judged in isolation and other things must be considered before choosing to start this type of Plan including the length of time it will take to repay your debt and the fact that it offers no protection against further legal actions by your creditors.

Privacy is just one factor to think about when considering an IVA

When deciding how to deal with a personal debt problem whether or not people will be able to find out about your situation is an important factor to consider.

If you are thinking about the possibility of starting an IVA you can be confident that no one other than your creditors will be specifically told about the agreement.

However, you need to understand that while you are in the arrangement you are formally insolvent. As such, your name will be included on the insolvency register which is available to be viewed by the public on the internet.

Having said that that there are many other things to think about when deciding on whether or not this type of Arrangement is the right debt solution to choose. In the main privacy should be taken as just one of a number of important factors that you consider.