Another way of solving finance problems is by using Individual Voluntary Agreements (IVA). A debtor can use IVA Debt Advice and find an alternative for keeping away from bankruptcy. It is a contract between a person in debt and his/her creditors. Before agreeing to the IVA, every creditor will consent on a resolution of how the debtor is going to repay the amount. Creditors usually prefer going for an IVA instead of the debtor applying for bankruptcy, as they can get better returns with an IVA.

Using an IVA is also good for the debtor, as they can avoid going for a bankruptcy declaration which will surely put a black mark on their credit ratings.

Furthermore, by using an IVA the debtor can prevent the creditors from getting an opportunity of seizing his/her home – this is possible if the debtor declares bankruptcy. However, a major thing to bother with an IVA is that the nonpayer is fairly unrepresented and the decision of the creditors about how things should proceed is taken as final.

While IVA is an official legal procedure, a DMP is not so. Usually, a DMP takes all of the unsecured debt of the person in debt, and merges all debt into one uncomplicated loan. A DMP is managed by a debt management company, who will produce an easier payment to be made by the debtor. Then they take the payments and use a pro-rata basis to disperse the money to creditors.

There are a lot of free debt advice and general Debt Management Advice on the web. This includes information on Debt Consolidation using IVA and DMPs, along with their comparative advantages and disadvantages. Using a DMP is especially found to be beneficial because the debt management company usually negotiates directly with the creditors to minimize the interest to be paid or to extend payment terms which will in turn lower payments. Also, a DMP will not negatively affect the debtor's interest rate, as the payments they make will be consented upon.

However, a shortcoming of using a DMP is that the debt management will usually charge a significant fee for their services, which hinders the debtor's ability to pay down debt fast. Also, using a DMP does not alleviate the debtor from paying off any balance on hand.