Can I do an IVA if I am unemployed

Technically speaking, there's nothing to say that you can't enter an IVA if you are unemployed.

Benefit Based Incomes

If your income is solely based on benefits, then it's unlikely that you'll be able to successfully apply for an IVA.

The benefits system provides funds for life's bare essentials, such as rent, food and clothing and little else.

As a result, it is considered inappropriate to use benefit based incomes for the repayment of debt, particularly through a formal debt solution such as an IVA.

What counts as benefit?

Generally speaking benefits such as Jobseekers Allowance (JSA) and Employment and Support Allowance (ESA) constitute incomes that, in isolation, can't be used to enter an IVA.

This means that if you are receiving JSA or ESA as your only income, an IVA would not be an appropriate debt solution for you.

What if I receive other incomes?

If you receive another income into the household, and the benefit is no longer the only source of income, then things change.

The benefit is no longer the sole income and an IVA can be considered an appropriate solution.

This can be particularly helpful when considering a Joint IVA, where two individuals apply for an IVA at the same time, using joint resources.

What if I have financial support from a 3rd party?

If you have a friend or a family member prepared to offer you financial support whilst your only income is benefits, then an IVA can be considered. These funds are known as 3rd party funds.

The 3rd party funds would need to be guaranteed as a supplemental income, but could be withdrawn once you had established a stable income of your own.

What if I have a job offer?

It's also possible to apply for an IVA if you've been offered a job in writing.

Having details of the position you have been offered, including start date and expected earnings, can be enough for us to begin an IVA application.

But, unfortunately, a verbal promise of a job would not be sufficient on its own.

Are there any exceptions?

One exception to this rule would be in the event of a Full and Final Settlement IVA, especially if you are considering emigrating to another country.

Under this scenario you would not need to have proof of an income at all, as your future plans would have no bearing on your Full and Final Settlement IVA being acceptable to your creditors.