The UK is facing a debt crisis highlighted by the fact that around 45,000 people filed for bankruptcy in 2005.

Most people seek to avoid bankruptcy at all costs. This is because of the stigmas and disqualifications associated with going bankrupt. The government recently introduced a legitimate alternative to bankruptcy in the form of an IVA.

The rise in the number of people seeking to set up IVAs suggests that it is widely viewed as a good alternative to bankruptcy. Indeed, of the 70,000 insolvencies in 2005, one third were IVAs.

An IVA allows people in serious debt to come to a formal debt re-payment arrangement with their creditors rather than having to face bankruptcy.

IVAs are suitable for people with debts over