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The main point to note is that you must be prepared and have all the appropriate documentation to allow us to start your IVA.
An IVA is an alternative to bankruptcy. It is a contract between you and your creditors.
In order for your IVA to start the creditors must be very flexible, creditors will reasonably expect their prospects of recovering money to be at least as good as in a bankruptcy. They will also expect the IVA to contain the options available if the IVA does not get off to a good start.
To start the IVA the IVA team will help you with your proposal to creditors and, initially, he is known as your ‘nominee’. If the creditors accept your proposal, an insolvency practitioner then becomes the ‘supervisor’ of the IVA.
Your proposal will be voted on by your creditors at a creditors’ meeting . Generally, if over 75% by value of your creditors who are represented at the meeting (in person or by proxy) vote in favour, the IVA will be implemented.
Creditors may put forward changes to the proposal, but they cannot impose them on you – you can decide whether or not to accept them.
You are not legally required to attend the creditors’ meeting, but in practice you should be there. Otherwise it will be impossible to agree any changes to the proposal. If last-minute changes are proposed, you should feel free to ask for reasonable time to think about them. If necessary, seek your IP’s private advice outside the meeting about what is being proposed.
An IVA gives you an opportunity to avoid bankruptcy. If it is not approved, a creditor may bankrupt you. It follows that you should put forward the best offer you can to your creditors. Be completely open and honest with your IP and the creditors about your financial circumstances…..more on the IVA procedure
An IVA or Individual Voluntary Arrangement is a legally binding agreement between you and your creditors (the companies you owe money to). The arrangement outlines how much you owe, and what you propose to pay back over the term of the arrangement (normally 5 years). During the term of the arrangement, your creditors won’t contact you, and as long as you keep up with the repayments, once completed, you become debt free. We would always recommend an IVA is considered along side bankruptcy and the other possible alternatives. It is important to stress that although an IVA is an increasingly popular debt solution, it should never be entered into lightly. It does offer a number of benefits like being able to write off often large percentages of the debt, protecting your home, and stopping money chasing calls and letters. However it also has some downsides. For example, it will be difficult to get any form of credit during the period of the IVA and for a period afterwards. Other frequently
