Why should creditors accept an IVA?
When submitting your proposal to creditors, one of the documents attached is a financial comparison detailing the outcome of the Arrangement and that of Bankruptcy. Generally creditors will not accept a Voluntary Arrangement unless the financial outcome for creditors is better than Bankruptcy. Because of the nature of Bankruptcy it is rare for an IVA to produce a worse outcome for creditors. Therefore once they are in receipt of the Proposal they are aware that commercially it is the best decision for them to make in that they are not able to get any further monies in any other way.
