Table of Contents
- What Is the IVA Protocol?
- What’s New in the IVA Protocol 2025?
- What Do These Changes Mean for Homeowners?
- Is an IVA Right for You?
- Steps to Take if You’re Considering an IVA
- Get Help with the New IVA Rules
If you own a home in the UK, chances are your budget already feels tighter than it did a few years ago. Mortgage deals that were fixed around 1–2% in 2020 are ending, and the replacement rates are closer to 4%. Add on higher council tax bills, energy prices that still feel steep, and weekly food shops that never seem to shrink and it’s easy to see why many families feel like they’re running uphill.
For some, unsecured debts like credit cards or loans have become the gap-filler. But when those payments stack on top of rising household costs, the pressure can get too much. That’s where debt solutions such as an Individual Voluntary Arrangement (IVA) may come into play.
And as of July 2025, the rules around IVAs have been updated through the new IVA Protocol. For homeowners especially, the changes could make a real difference.
What Is the IVA Protocol?
An IVA is a legally binding agreement that allows you to repay unsecured debts in affordable monthly installments. Usually, it runs for five or six years, and once you’ve completed it, any remaining debt is written off. It’s set up by an insolvency practitioner, who manages payments and liaises with your creditors.
The IVA Protocol, meanwhile, is the agreed “rulebook” most providers follow. It was created so IVAs are consistent and fair, no matter who you deal with. Not every IVA has to stick to it, but most do, which means the 2025 changes affect a large proportion of new arrangements.
What’s New in the IVA Protocol 2025?
The 2025 update is the biggest in years. Here’s what stands out for homeowners:
Equity threshold and IVA length: Under the new rules, you won’t be asked to release equity from your home, no matter how much you have. Instead, the amount of equity determines how long your IVA will last. If your equity is under £10,000, the IVA will usually run for five years. If it’s £10,000 or more, the IVA will normally extend to six years.
Your home isn’t treated as an asset: The family home is no longer listed as something to be sold or realised in the IVA. This gives homeowners stronger reassurance that their property is protected.
Key facts upfront: Before you commit, providers must give you a clear “key facts” document. It sets out how the IVA works, what happens to your credit rating, and how your home is treated.
Flexibility when life changes: Supervisors have more authority to allow short breaks or reduce contributions if your circumstances shift, making IVAs easier to maintain over the long term.
Put simply, the protocol is trying to make IVAs clearer at the start and more realistic to maintain.
What Do These Changes Mean for Homeowners?
For many, the new protocol takes some of the fear out of the process. The thought of losing your home has always been one of the biggest worries with debt solutions. These rules are designed to put that concern to rest.
If your equity is below £10,000, your house is left alone. If it’s above, you might stay in the IVA a year longer, but your property isn’t at risk of repossession as part of the arrangement. Everyone gets a clearer picture upfront, thanks to the key facts document.
Not sure how much equity you have? We will calculate it for you as part of a free assessment. The IVA Protocol uses 85% of your home’s value and compares it with what you owe on the mortgage.
Is an IVA Right for You?
The protocol makes IVAs fairer, but they’re not a “one size fits all” fix. An IVA could be suitable if you:
– Owe more than £7,000 in unsecured debts.
– Have a steady income to support regular payments.
– Want to avoid bankruptcy and keep your home.
But if your debts are smaller or your income isn’t stable, there may be other options:
– A Debt Relief Order (DRO) if your total debt is up to £50,000.
– A Debt Management Plan (DMP) if you need more flexibility month to month.
That’s why it’s important not to jump in blind. Getting advice first means you’ll know if an IVA is truly the right path.
Steps to Take if You’re Considering an IVA
If you’re a homeowner exploring the new rules, here are a few sensible moves:
– Work out your equity: Use a recent property valuation and subtract your mortgage and any secured borrowing. This will tell you if you’re above or below the £10,000 threshold.
– Get regulated advice: Speak to a debt advisor before making any commitments. They can explain all the routes available.
– Ask for the key facts document: It’s now your right to have one before signing up.
– Act sooner rather than later: If you’re already juggling mortgage hikes, council tax, and other bills, don’t wait until arrears build up. The earlier you ask for help, the more options you’ll have.
Get Help with the New IVA Rules
The 2025 IVA Protocol is designed to make things clearer and safer for homeowners, but it can still feel like a lot to take in. If you’re struggling with debt on top of rising mortgage and household costs, remember: you don’t have to figure it out alone.
At PennyPlan, we’ll talk you through how the new rules work, check whether an IVA is right for your situation, and outline any alternatives that might suit you better.
Our advice is free and confidential, speak to our team today.
