Both an IVA and bankruptcy are significant insolvency events that will appear on your credit file for several years, making it difficult to access new credit during that time. While lenders generally treat bankruptcy as the more serious event, both options indicate that you have been unable to repay debts as originally agreed.
Understand the key differences between an IVA and bankruptcy to help you plan your path forward.
Use our free debt payoff calculator to see how extra payments can save you money and reduce your repayment term.
Living with debt can be stressful, especially when the end date feels impossibly far away. It’s hard to stay motivated when you don’t know how long it will take to clear your balance. But what if you could see the finish line?
Our free Debt Payoff Calculator is a powerful repayment planning tool designed to give you clarity and control. By showing you the real-world impact of extra payments, it helps you build a clear plan to pay off your debts faster and save money in the process.
See How Extra Payments Can Cut Your Debt Faster
You might be surprised to learn that even small, consistent extra payments can dramatically shorten your repayment time and slash the amount of interest you pay over the life of your debt. An extra £20 or £50 a month can knock years off your term.
Our tool is designed to be flexible. Whether you’re looking for a credit card repayment calculator or a loan repayment calculator, it can model various types of debt in real time, giving you an accurate picture of your path to clearing your balances.
How to Use the Calculator
We’ve designed the calculator to be simple and intuitive. Here’s how it works:
- Step 1: Enter your current debt balance, the interest rate (APR %), and your current monthly payment amount.
- Step 2: Add an amount in the ‘extra payments’ field to see the magic happen.
- Step 3: Instantly see your new, earlier payoff date and the total amount you’ll save in interest.
- Step 4: Adjust the figures as much as you like to compare different scenarios and find a repayment plan that works for your budget.
Why Extra Payments Make a Difference
The maths behind paying off debt faster is simple but effective. When you only make minimum payments, a large portion goes towards paying off the interest. However, any amount you pay above the minimum goes directly towards reducing the principal (the original amount you borrowed).
As your principal balance shrinks, the amount of interest charged each month also decreases. This creates a snowball effect, allowing you to pay off credit cards faster with every extra payment. For example, paying an extra £50 per month on a £3,000 credit card balance at 20% APR can save you over £400 in interest and clear your balance years ahead of schedule.
Plan Your Extra Payments
Seeing how much you can save is motivating, but the next step is finding that spare cash in your budget.
To help with this, “Use our Pay Off Calculator to spot where you can free up money for extra repayments.” By combining the savings calculator with our debt payoff tool, you can create a complete and powerful financial plan.
Tips to Accelerate Your Payoff
Ready to get started? Here are a few optional tips to speed things up even more:
- Automate your overpayments by setting up a standing order. This removes the temptation to skip a month.
- Redirect any windfalls like work bonuses, tax refunds, or side income directly towards your debt.
- Follow a clear strategy. For a complete guide on tackling credit card debt, read our article: How to Pay Off Credit Card Debt.
Discover more practical tips to manage your credit cards. Check out our Clearing Card Debt page to find out more ways to clear your balances faster.
Final Thought
Looking to pay off credit card debt? If you’re looking to consolidate credit card debt and cut down on high interest, check your eligibility for Updraft, or download our app today.
Loans from 15.3% APR (25.9% APR Representative)
25.9% APR Representative based on a £10,000 loan over 60 months at 20.40% fixed interest p.a. Monthly repayment: £283.20. Total repayable: £16,992 (inc. £600 fee). Subject to status and affordability. Consolidating debt may increase the term and total amount repaid. All figures are representative and based upon an assessment of credit and affordability. Terms and conditions apply.
From 15.3% to 41.2% APR, £1,000–£25,000, over 2–5 years available.
About Updraft
Updraft helps people pay off credit card debt. The app connects to your accounts, shows you what your borrowing costs, and where it makes sense replaces card and overdraft balances with a single Updraft loan. We’re rated 4.8 out of 5 on Trustpilot by the people using it to do exactly that. More about Updraft
Updraft Awards & Recognition
Recognised for helping borrowers take control of card debt.
Frequently Asked Questions
Which is worse for your credit score?
Can I keep my house with an IVA?
An IVA is often preferred by those who wish to avoid selling their property. While the agreement may require you to release equity in the final year, it is typically structured to allow you to retain your home, unlike bankruptcy where your share in the property is at significant risk.
How long do an IVA and bankruptcy stay on my credit file?
In the UK, both an IVA and bankruptcy are recorded on your credit report for six years from the date they begin. Once this period has passed, they are automatically removed from your file, though the long-term impact on your ability to borrow will depend on your overall financial management since the event.