Can Creditors Reject My IVA?
Yes. Creditors can reject an IVA if they do not think the proposal is fair, affordable or better than the alternatives. An IVA is only approved if creditors representing at least 75% by value of the voting debt agree.
A rejection does not mean you have no options. It means the proposal needs to be changed or another debt solution should be considered.
How IVA Voting Works
Your Insolvency Practitioner sends the IVA proposal to creditors. Creditors can vote for, vote against, abstain or ask for changes. The IVA is approved if at least 75% by value of the creditors who vote support it.
This is about debt value, not the number of creditors. A large creditor can have more influence than several small ones.
Why Creditors Reject IVAs
Common reasons include:
- the monthly offer looks too low
- the budget includes expenses creditors consider excessive
- debts or assets are not fully explained
- recent borrowing raises concerns
- the proposal gives creditors less than bankruptcy might
- income is unstable
- the IVA looks unsuitable compared with a DRO or DMP
- previous failed arrangements reduce confidence
Creditors may also request modifications rather than reject outright.
What Are IVA Modifications?
Modifications are changes creditors ask for before approving the IVA. They might include:
- a higher monthly payment
- a longer term
- tighter rules on overtime or bonuses
- changes to vehicle, asset or equity treatment
- clearer review requirements
- limits on expenses
You do not have to accept modifications if they make the IVA unaffordable. An unaffordable IVA is more likely to fail.
What Happens if the IVA Is Rejected?
Your options may include:
| Option | When to consider |
|---|---|
| Revised IVA | The proposal can be improved and still affordable |
| DMP | You can repay debts over time without formal insolvency |
| DRO | You meet strict income, asset and debt rules |
| Bankruptcy | Debts cannot realistically be repaid and risks are acceptable |
| Informal settlement | You have a lump sum and creditors may negotiate |
Read IVA vs DMP, IVA vs DRO and IVA vs bankruptcy before deciding what to do next.
How to Improve Approval Chances
- Be honest about every debt, asset and income source.
- Use bank statements to build a realistic budget.
- Explain car, rent, childcare and medical costs clearly.
- Avoid new borrowing before applying.
- Ask the provider to compare bankruptcy and DRO outcomes.
- Do not propose payments you cannot maintain.
Frequently Asked Questions
What percentage of creditors must approve an IVA?
An IVA is approved if creditors representing at least 75% by value of the voting debts agree to it.
Can I refuse IVA modifications?
Yes. You should not accept modifications that make the IVA unaffordable. If changes cannot be agreed, another debt solution may need to be considered.
What happens if creditors reject my IVA?
If creditors reject your IVA, you may be able to revise the proposal or compare alternatives such as a DMP, DRO, bankruptcy or informal settlement.
Check Whether an IVA Proposal Is Realistic
Use the eligibility check to compare whether your debt level, income and creditors point toward an IVA or another route.
Check EligibilitySources checked
- GOV.UK: Individual Voluntary Arrangements for IVA approval basics.
- GOV.UK: IVA Protocol 2025 for protocol proposal expectations.
- MoneyHelper IVA guide for IVA suitability and advice context.