Katie Price reaches agreement with creditors to avoid bankruptcy

Katie Price has avoided bankruptcy after reaching a deal with her creditors.

A specialist insolvency and companies court in London was told on Tuesday that the former glamour model has agreed a plan to pay back what she owes.

She was given time to try to come to an agreement at an earlier hearing.

The 40-year-old, formerly known as Jordan, has tied the knot three times and has been in the headlines following the collapse of her most recent marriage to Kieran Hayler.

She has also recently revealed that her mother, Amy Price, has been diagnosed with idiopathic pulmonary fibrosis (IPF) – the same disease that killed TV presenter Keith Chegwin.

Price was arrested in October on suspicion of drink-driving after being found by police at 2am in a damaged car in Woolwich, south-east London.

The ex-Loose Women panellist revealed in July she had reported herself to police for violating a driving ban, handed to her in February after she was caught speeding.

The former I’m A Celebrity … Get Me Out Of Here! star was once said to be worth more than £40 million.

At a hearing in October, she was given time to negotiate a deal with the taxman over her finances by a judge at a specialist insolvency and companies court.

The case was previously adjourned following a hearing in August to allow time for the consideration of an Individual Voluntary Agreement (IVA).

Lawyers representing her creditors told the court on Tuesday that her IVA proposal was accepted on November 30.

An IVA is a formal agreement which lets people with debt repay their creditors at an affordable rate in a bid to avoid bankruptcy.

Speaking to the Press Association after the August hearing, a representative for the reality TV star said: “Katie is aware of the hearing and is working with her advisers to resolve her current financial issues.

“She hopes to be in a position to do so and reach agreement with her creditors.”