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IVA's and bankruptcys are two very different, yet powerful, solutions for managing problem debts, and neither should be entered into lightly or without specialist help.
Essentially, an IVA is a debt repayment plan, agreed by chosen creditors and managed by an Insolvency Practitioner, who will help you set up an agreement with your creditors, agree the payment plan and then handle all your payments to creditors and any administration. In this way you will stop being contacted by creditors - so offering peace of mind - and you will eventually be discharged from the plan, usually set at 5 years, debt free, so long as you've stuck to the IVA conditions.
Bankruptcy on the other hand is generally considered to be the last resort, and although it frees you from debts within a year, you will likely lose your assets including home, shares, objects of high worth etc, so they can be shared out amongst creditors to repay your debt. Bankruptcy can be voluntary or forced, and although it is quick, it can cause problems in the future with things like mortgages or even employment.
When it comes to tenancy agreements, if you go bankrupt, the official receiver of your bankruptcy in most cases will tell your landlord - so speak to your landlord directly before this happens. Furthermore, some tenancy contracts contain clauses excluding undischarged bankrupts from being tenants within the property, so you may find that you are obliged to move out of your rented property. It may also be the case that you are falling behind with your rent payments on the rented property, in which case the landlord is within his or her rights to seek a possession order and have you moved out of the house. If this occurs you should contact your local housing office as soon as feasibly possible to explain your situation and seek help.
With an IVA, however, there is not the same risk to tenancy agreements as there are with bankruptcies if you're living in rented accommodation. However, it's worth checking your agreement carefully as some landlords do have contractual clauses which prevent their tenants from entering into IVAs, and again you may find that you are given your notice period and asked to leave. These are all important things to consider when looking at your options for managing problem debts, and for this reason you should always seek to engage the help of a specialist. They will be able to advise you of your legal rights as a tenant and the best solution for your particular set of circumstances. It is also worth speaking to your landlord as soon as possible about your financial difficulties, so that they are aware of it. You may find that they are prepared to be a little flexible.
The important thing is to tackle the problem head on and not bury your head in the sand! Debt is a worrying state of affairs, but with the right kind of help and support you will be able to find a way out of it.
