IVA Articles

By Johns Tiel

The frightening figures stem from people who are earning half the average the others earn. Scores of people visit different commercial institutions every day, since desperately looking for an answer to their debt problems. These people are condemned to a lifetime of financial difficulties with debt taking over their lives and blocking out any hope for a bright future. Considering the fact of the matter, the lending authority has started offering generous assistance under the provision of IVA help. This help helps rebuilding debtors’ credit scores for the future prospect of borrowing.

Who is best suited to IVA help:

• Personal loans
• Student loans
• Credit cards
• Store cards
• Overdrafts
• Catalogues
• Outstanding balances after home or vehicle repossession
• Business loans for which you are personally liable

It will depend on your personal circumstances. Normally your personal debts must be above £15,000 and you should have three or more different creditors. You must also be able to offer a reasonable monthly payment to your creditors. The condition of IVA help varies depending on the debt. However, as a guide to IVA help, you will usually need to be able to afford at least £200/mth.

An IVA help can also be accepted with conditions attached. These conditions are called creditors modifications, and can range from incidental modifications, over how the IVA help manages over the stipulated period of five years by the insolvency practitioner. Through the modification of the size of monthly repayment of debtor must contribute before the IVA help becomes acceptable to creditors.

In some circumstance, legal action may well be undertaken by a creditor against a debtor who is proposing an IVA Advice help (individual voluntary arrangement). In such cases, at the sole discretion of the appointed Insolvency Practitioner, it is possible to apply for an Interim Order. An interim Order protects the debtor from any further court action being taken until the IVA help (individual voluntary arrangement) application process is completed and proposed to the creditors.

For entire of the IVA help process, there are many lenders available online and offline. For better suitability and instant processing, there are innumerable sites are just a click away to the debtors. Just cull some of them, and go through the terms and conditions they have planned to. Compare the select Insolvency Practitioners’ policies and plans altogether, make your IVA help plan according to your budget suitability.

Johns Tiel holds a master degree in Commerce from JNU. He is working as financial consultant in Chance For Loans. To find IVA help, improvement loans, IVA, unsecured loan, secured loans, debtconsolidation loan that best suits your needs visit http://www.chanceforloans.co.uk/

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By James Copper

With consumer borrowing at an all time high the nation is riddled with debt. This coupled with the sharp hike in interest rates has meant that many people are struggling to keep up with their monthly payments. If you are in debt then you are not alone.

You have a number of options to become debt free and financially stable again. You need to consider each of these options carefully and make sure you choose the best one to fit your circumstances. Below is a brief overview of the options you have available, remember to always seek expert IVA Advice before making a decision.

Debt Management Plans

A debt management plan is an informal arrangement between a lender and a customer to repay debts at a lower repayment level than contracted for, which is usually around three percent per month of the outstanding balance. Generally debt management plans can be considered in the following circumstances:

# Debts are less than 20,000.

# There is a monthly surplus of at least 200 - 250 to offer creditors.

# If you can pay 1 percent or more of the outstanding debt per month.

# If you are a homeowner and there is insufficient equity in the property.

# If smaller debts can be cleared within a couple of months.

# If debts may be cleared in less than 60 months.

# If the debtor is a tenant.

# If debts are normally affordable but arrears have occurred.

Individual Voluntary Arrangement (IVA)

An Individual Voluntary Arrangement or IVA is an alternative to bankruptcy, it is an offer by an you to your unsecured creditors in order to settle debts. The minimum payment (called a dividend) that the creditors will agree to is twenty five pence in the pound.

The process involves preparing a statement of affairs and referring the case to an Insolvency Practitioner (IP), who is usually a Chartered Accountant who specialises in insolvency. The IP puts together a proposal for the creditors, in order for the IVA to be accepted, seventy five percent in value of the creditors must vote to accept the IVA.

Generally the IVA involves a monthly payment from your surplus income for a five year period. It could also include capital raised from your assets such as the introduction of equity from your property.

Usually the IP will charge fees as a lump sum (between 2000 to 3000) up front, some take their fees from the monthly contributions. There are also other fees involved.

You can use the following checklist as a rule of thumb to establish whether an IVA might be the best solution for you:

# Debts are more than 20,000.

# There are more than 5 creditors.

# The minimum dividend to creditors is twenty five pence in the pound

# Debtor has no assets (eg is a tenant).

# Debt has sufficient income to pay 225 to 250 per month.

# Debts will take longer than 60 months to clear in the normal way.

Banks and other lenders have become more and more frustrated with IVAs. This is because they have become more prevalent in society, which means they are writing of more debts. Some people use an IVA as the easy way out, when previously they would have found a way to pay of the debts in the normal fashion or agree on a deal with the lender.

Remortgage

If you are a homeowner then in some cases a remortgage might be your best option. People generally do get a little nervous about using the equity in their house to pay of their debts.

If you have a number of unsecured debts and your creditors are aware that there is equity in the house they may apply for a County Court Judgement (CCJ). If a judgement is obtained it is available to the creditor to seek further enforcement action which may include placing a charge on the debtors home.

A remortgage is basically changing the lender and/or deal that you are currently on for a new one. At the remortgage stage you can also dip into the equity you have and use it to clear off your outstanding debts.

A remortgage can be a very good option, if you think of the rates you are paying to credit card companies, lenders, etc then clearing them and just having one lower monthly payment is an attractive proposition.

Secured Loan

A secured loan is basically a second charge on your property behind that of your main mortgage. A secured loan is a loan that is paid out to you based on the equity available in your home. You will pay the secured loan off over a period of between 5 to 30 years at a monthly payment that is deemed affordable to your circumstances.

If you have equity available in your property then a secured loan can provide a great solution to clearing your debts. With a remortgage there are a number of expensive fees involved not to mention the possibility of an early repayment penalty from your current mortgage lender. A secured loan does not carry such burdens. Also with a secured loan generally you will not have a hefty early repayment charge.

The rates on secured loans will be much more reasonable than the unsecured debts that you have. The secured loan lender will require you to produce a breakdown of your outstanding debts and monthly payments and make sure that the loan will be affordable, but other than that, obtaining a secured loan is a reasonably straight forward process.

So as you can see there are a number of options available to you. Each one has its advantages and disadvantages, all of which need to be assessed on an individual basis. Now you are armed with a basic understanding you can easily go and speak to companies and experts about your situation and work to resolve your debts.

James Copper enjoys writing on all areas of personal and commercial finance. He works for Any Loans who source Secured Loans for people with credit problems. Have a look at http://www.any-loans.co.uk

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By Peter O’Sullivan

One of the most common questions that I get asked each day is, what exactly is an IVA?

An IVA is a preferable option to bankruptcy and stands for the term “Individual Voluntary Arrangement”.

It’s basically a formal arrangement between you and your creditors to pay a pre-agreed amount of money towards your debts on a monthly basis, typically over a term from three to five years. And providing all the pre-agreed payments are paid at the agreed times, the remainder of your debts are written off by your creditors.

Quite often this can mean that you effectively walk away from up to 75% of your debts in a matter of weeks.

IVAs can also be set up with just an up front lump sum payment, (if and when funds are available), or a combination of a smaller lump sum payment and a lower monthly payment over a pre-agreed period of time.

Now obviously, individual voluntary arrangements are NOT suitable for everyone. They are structured to help people in certain circumstances to improve their debt problems without the need to file for bankruptcy.

The qualifying criteria and the amount of debt that can be written off very much depends on who your creditors are.

As a general guide, if you owe more than £15,000 spread amongst three or more different creditors, it’s possible that you’ll be eligible to apply for an IVA, but it’s recommended that you get the best IVA Advice to find out if this would be the best option for your specific circumstances and level of debt.

Should an IVA not be an option for you for some reason, many IVA companies will also be able to help you to take advantage of a debt management plan which can quite often involve a reduction in your debt repayment amount and also freeze all future interest payments and charges.

The benefits involved with dealing directly with a professional IVA or debt management company are that you can tap into their experience of dealing with creditors for people in situations just like you and also they are acting solely on your behalf, so have only your best interests in mind when negotiating an appropriate debt payment plan.

Most IVA and debt consolidation centres are professionally qualified, so fully understand the legal aspects involved with each stage of the IVA application process and any possible debt management plan they may feel is a suitable solution to your particular financial situation.

If you feel an IVA might be the answer to your debt problems, take some time to speak to an IVA centre today!

Peter O’Sullivan is a professionally qualified financial consultant, specialising in providing debt solutions and free IVA advice to anyone in the UK who feels their finances are becoming difficult to manage. To find out how he can help you to deal with your debts, call 0800 056 9695 or visit The IVA Centre today, for your copy of his latest Special Report entitled, “7 Things You Must Know About IVA’s!” This is a limited time offer, so get your copy today, before it’s too late!

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By Diana Middleton

According to accounting firm PricewaterhouseCoopers, the number of people in the UK entering into individual voluntary arrangements to escape debt is on the decline. The firm reviews about 50 per cent of all proposed IVAs for its clients who are the creditors of those in debt. Some of these clients include banks. The records of PricewaterhouseCoopers seem to suggest that the trend has been occurring during the past four months.

An IVA is an alternative to filing bankruptcy , and allows the debtor to repay a portion of his or her debt. An insolvency expert at PwC feels that current trends are indicative of a gradual month to month decrease in IVA cases. One reason for this is believed to be stabilization in the amount of personal debt after a large increase during the first five years of the 21st century.

Personal debt increased in 2006, but the amount of outstanding balances on credit cards declined because of a decrease in use, the first time that has happened since their introduction in 1966. Official statistics from the government’s Insolvency Service indicated that in 2006, there was nearly a 60 per cent increase in personal insolvencies, but this is believed to be because more people turned to IVAs in order to eliminate some of their debts. The figures seem to be stabilizing now that the majority of consumers have completed their proposals for IVAs.

Another contributing factor to the decrease in IVAs is the attitude of some lenders that are adopting a stricter policy toward the IVA proposals that they receive on behalf of their indebted customers. IVAs are voluntary, and a creditor is not obliged to accept the proposal if he thinks the debtor can repay more of their debts that suggested in the IVA proposal. Banks are expressing irritations with a minority of people who try to push through IVAs who the lender feels is in a position to pay off more of their debts without an Individual Voluntary Arrangement.

Research shows that the typical seeker of an IVA is a male in his 40s with debts between £40,000 and £43,000. An IVA can significantly cut that debt with a five year repayment term. Because of the hard-nosed attitude that lenders have begun to take toward IVA proposals, new IVA companies that have opened in the past few years are reporting a decrease in business over recent months. In spite of that, analysts warn that the trend could pick up again, especially if mortgage rates increase. If interest rates on mortgages increase, people are less likely to use their homes to eliminate debt and will be forced to find other ways for reduced their debt load such as an Individual Voluntary Arrangement, or perhaps worse, bankruptcy.

Diana Middleton writes on matters relating to IVA Advice in the UK, and especially debt problems. She is particularly interested in personal finance, writing on best approaches to getting a secured loan or IVA, and the background issues relating to debt consolidation.

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By Iain Wrenshall

An IVA, (Individual Voluntary Arrangement) is a formal agreement that allows a person in financial difficulties avoid petitioning for bankruptcy. New monthly repayments are arranged, based on affordability to the debtor, and these repayments are paid for an agreed period, normally 5 years. When the repayments have been completed, any outstanding debt is written off, and the debtor is debt free.

As a debt consultant that specializes in IVAs, one of the most common questions that I am asked by my clients is “How much will my repayment be?”

So here is a brief description of how the IVA repayments are calculated, but before I start certain points must be explained.

The IVA repayments need to reflect an ‘honest’ affordable figure.

The creditors will need proof that the debtor can afford the repayments and no more.

The success or failure of an IVA will be depend heavily on the debtor adopting a realistic financial approach.

The details of the debtor’s financial position are lodged in court. This makes the IVA a legal process.
Therefore, any debtor that tries to manipulate the size of the repayment by either overstating or understating their true financial position, will be putting their IVA in jeopardy, not to mention committing a criminal offence.

The first part of the calculation is establish the debtors income. This needs to be the debtors net income, i.e. the income that the debtor receives after their taxes have been deducted. Any other incomes that the debtor may receive also need to be calculated, e.g. any overtime, bonuses or commissions that do not form part of the net income, a part time job or any state benefits that may supplement the debtors income.

Once this figure has been calculated the next step is to analyse the debtor’s expenditure. All general living expenses need to be accounted for. Examples of things to include are rent and housing associated costs, food and clothing, travelling expenses, and an element of expenditure for sundries. What ought to be excluded at this point are the current debt repayments. They will cease to be paid and should not be calculated. Every debtor has their own unique circumstances and therefore one person’s expenditure will vary from another, so it is essential that all relevant expenses are noted.

It is important to realise that luxury items, nonessentials and excessively high expenses will be challenged by the creditors, when they are given their opportunity to vote. Hence the debtor needs to be honest with themselves in regards to what will be deemed acceptable to creditors as part of a reasonable daily budget.

Once both sides of the equation are assembled, i.e. the income and expenditure, the figure is established.

The monthly repayment into an IVA will be equal to what remains after the expenditure is deducted from the income. This figure is known as the disposable income.

It must be stressed that there are established guidelines, set by the creditors, that determine what level of repayment will be deemed too low for an IVA to be considered. This level is determined by the value of the debts that the debtor has, but it is generally considered to be 25% of the debt, plus costs, as a minimum. N.B. Recently some creditors have modified these minimum repayment levels to 40% plus costs.

Now that the repayment has been calculated, and assuming that the amount is higher than the minimum level for the size of debt, the insolvency practice that is acting on behalf of the debtor will require proof that the submitted figures are accurate.

Once the figures have been verified, and the insolvency practitioner has made any required adjustments, the figure ought to stand up to the scrutiny of the creditors.

However, if the creditors do insist on making modifications to the repayment amount before they will accept the IVA, the debtor will be informed of the creditor’s modifications, and can withdraw from the IVA process if they cannot agree to the creditor’s changes.

Iain Wrenshall is a senior debt adviser for myIVA-Adviser.com and specializes in Individual Voluntary Arrangements.

Taking the first step of asking for IVA Advice with a debt problem is never easy. However, do not feel you are on your own. I invite you to call 0800 088 7503. Your call will be free and will be treated in the strictest confidence by our small, specialist team of advisers. Each of whom has been trained to the highest standard in finding ethical solutions for all aspects of personal debt related problems, particularly Individual Voluntary Arrangements and, what’s more, none of them are driven by sales targets.

However, if you are not ready to discuss your circumstances just yet, but would like further information about IVAs, click here and download any of our 6 free guides. They are packed with great tips and solid advice on all the aspects of IVAs you need to know.

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By Mike Curry

This May, the Department of Trade and Industry in the UK found that there were 10,091 bankruptcies in the first quarter of 2005. This represents an increase of 24.5% on the corresponding quarter of last year.

Bankruptcy can leave an individual feeling ashamed, depressed and out of control. Furthermore, for many the stigma of bankruptcy can be too much to bear.

However, there may be an alternative to going bankrupt which can also help people in serious debt to make a fresh start.

The Insolvency Act of 1986 introduced The Individual Voluntary Arrangement (also known as an IVA) as an alternative to bankruptcy.

The idea behind the introduction of the Individual Voluntary Arrangement was to enable people facing financial difficulties to come to a formal agreement with their creditors rather than having to face bankruptcy. If an IVA is agreed between the debtor and creditor:

Interest on the loan is frozen
Legal proceedings are stopped
The overall debt is reduced

An Individual Voluntary Arrangement is generally seen as a more favorable option than bankruptcy from both the debtor’s and creditor’s perspective. This is because there are no fees or legal proceeding involved with an IVA, unlike with bankruptcy. Furthermore, from the creditor’s point of view, an Individual Voluntary Arrangement offers a greater repayment of the debt than would otherwise be achieved if the debtor were made bankrupt.

IVAs represent an exciting new opportunity to those facing serious debt to both avoid bankruptcy and to make a fresh start. But do make sure you get the right IVA Advice

Mike Curry is the head of Clear Start- a free national support service for those facing serious debt. Clear Start offers independent advice on debt management and individual voluntary arrangements. For more information please visit Clear Start.org

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By S Young

The Individual Voluntary Arrangement is a revolutionary provision for all individuals out there struggling to cope with heavy debts and is actually a viable alternative to declaring yourself bankrupt. As a result, the Individual Voluntary Arrangement can actually enable you to limit the amount of damage that you do to your credit rating!

An Individual Voluntary Arrangement is:
A formal agreement between yourself and your creditors
A document reducing the amount your pay back on your debts to make them more manageable for you.
An arrangement set up via an Insolvency Practitioner to ensure that all parties involved maintain it.
Usually completed after five years. After five years you will become debt free and all your remaining debts will have been paid off.
The provision for the Individual Voluntary Arrangement was made in the Insolvency Act of 1986 to try and help individuals become debt free without having to file for bankruptcy, and to help creditors recover as much of the debt as possible. All income and assets should be assessed during the initial stages of the application to establish just how much you can afford to pay. This may include:

Regular income
Savings and investments
Income from third parties
Assets, such as an endowment policy

All of these assets can actually determine just how much you can afford to pay back. Only disposable income is taken into account so an individual applying for an agreement will be able to afford the bills and housing costs, as well as having enough left over to eat and enjoy life to a certain degree!

In the same way that bankruptcy involved court action, so does an Individual Voluntary Arrangement. The court must be informed and appoint the Insolvency Practitioner to help you and to supervise your repayments over the years governed by the agreement.

All in all, an Individual Voluntary Agreement can be a good idea for many individuals facing the breadline and deliver peace of mind. After the stress that comes from being heavily in debt, this will no doubt make a welcome change!

Individual Voluntary Arragement

Need IVA Advice? Visit http://www.debt-managing.co.uk/iva.php for some professional advice.

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By Christopher Robin

An IVA is a modern alternative to bankruptcy. Although IVA’s first became available in 1986 via the Insolvency Act, they have only gained notoriety in the public domain in recent years. An IVA is a legally binding contract between a debtor and their creditors. An IVA typically lasts for 5 years, at the end of this term the debtor will be debt free. During this term, fixed monthly repayments, that reflect the debtor’s available disposable income, will be made. An IVA is particularly suited to debtors who have financial support from relatives and/or have a reliable and regular income. An IVA will be supervised by a debt management company.

How is an IVA arranged?

Firstly, a debtor must secure the help of one of the many debt management companies. Under their guidance, a debtor will make an IVA proposal. This proposal will be presented in court and will include details of a debtor’s financial situation; and a realistic repayment plan. Following this, all creditors must be sent a copy of this IVA proposal as well as advance notice of an IVA proposal meeting. At this meeting the creditors will vote as to whether the debtor in question should gain an IVA. The debtor’s IVA proposal must be accepted by at least 75% of creditors present (in person or by proxy) to allow the IVA to go ahead. If the IVA proposal is accepted, any creditors (present or not) who received formal notice of the IVA proposal meeting are bound by the terms and conditions of the IVA contract. Any creditor who did not receive notice of the IVA meeting will be exempt from this contract, thus, it is important to have well kept records of all creditors.

There is no official amount of debt that is required to have an IVA approved. It simply depends on whether a debtor’s combined creditors agree that an IVA is appropriate. The cost of an IVA will depend on a variety of factors. These include the term of the agreement, the outstanding debt, a debtor’s disposable income and the administration costs (including the collecting of information for the proposal and creditors meeting).

While bound to an IVA if a debtor’s circumstances change they may request that their creditors attend a variation meeting, which may in turn lead to an amended proposal.

Benefits of an IVA

Until the introduction of IVA’s, bankruptcy was the harsh reality for consumers who lost control of their debts. Bankruptcy is a costly and public affair. A debtor will loose all control over their assets and their credit rating will suffer further damage. In contrast, as a solution to the problem of debt, an IVA offers many benefits:

Costs are lower.

A debtor’s disposable income will be taken into account when repayments are set. Thus, it is typical that the overall debt repayment is reduced. Provided the conditions of the IVA have been adhered to any outstanding debt will be written off at the end of the IVA term.

From the date of arrangement all interest and charges on debt are frozen.

Fewer restrictions apply than with bankruptcy. For example, a debtor with an IVA will not incur the risk of having their business terminated.

With an IVA a debtor will maintain some say in the control of their assets. A debtor must make their best repayment offer to the creditors. Providing an asset is not considered surplus to needs, a debtor will not be required to sell it. A debtor will not be required to sell their home, but will be expected to re-mortgage it to release equity that can be used to fund repayments. It is also possible to exclude some other assets from being repossessed, such as life assurance or a motor car.

Even if a debtor has been declared bankrupt an IVA may still be an option. However, it is worth noting that ideally a debtor should secure and IVA before bankruptcy is decaled, to avoid the excess costs.

Unlike with bankruptcy an IVA is not published in the local press, nor is a debtor required to inform an employer. However all IVA’s are listed with the department of trade and industry, which is available for public inspection, when requested. An IVA will also be listed on a debtor’s credit file.

Successful completion of an IVA will result in a certificate of compliance and will improve a debtor’s credit rating.

Creditors can bring no further charges against the debtor. For example no bankrupting proceedings or count court judgements.
Complications of an IVA

Secured debts can not be catered for by an IVA. However, repayments required on a secured loan can be taken into account when an IVA proposal is made. This means that the repayment amount for the IVA may be lower to allow the debtor to keep up repayments on any secured loans. It is worth noting that as with bankruptcy, fines and arrears on Child Support Agency payments are also excluded from the IVA.

It is important to adhere to the terms and conditions of an IVA, failure to do so may result in a creditor petitioning for bankruptcy and/or the collapse of the IVA. A debtor needs to ensure they declare all debts and assets and keep up repayments. In certain circumstances if a one-off repayment cannot be made it may be possible to agree this as acceptable with the IVA supervisor and continue with the IVA.

With the exception of basic utility credit, credit will not be approved while a debtor has an IVA.

Joint Debt

In the case of joint debt, both parties are liable for the whole of the debt. If one party secures an IVA, there is nothing to prevent creditors from claiming the debt from the other party. In the case that one party gains approval of an IVA, the options for the other party will depend on the amount of debt (including joint debt) they have.

If the partner’s debt is less than £10,000, an IVA will not be financially viable. The cost of setting up such an agreement would be disproportionate to the debt. In this case the non IVA partner will need to make provisions to ensure that their existing non IVA debt repayments can be maintained. This may be quite a challenge as the IVA partner will simultaneously need to make their repayments according to their IVA. For this reason, the non IVA partner may opt to secure a debt management plan to reduce debt payments.

In the case that the partner has a large amount of debt, exceeding £10,000, jointly the partners can make a proposal for a linked IVA. The cost of running a linked IVA is typically 50 % higher than an individual agreement.

Conclusion

Modern day society is often characterised by high financial demands on typically low salaries. A consumer can easily find themselves becoming overwhelmed by debt. In most case an IVA with its many benefits is a welcome solution to the problem of debt. But make sure you get the best IVA Advice

Christopher is a writer for this IVA article. More information on what is IVA.
More on Secured loans.

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By Andrew Waldenson

Have you been thinking of claiming bankruptcy? What if there was another option other than bankruptcy to solve one’s financial dilemma that is just as beneficial as bankruptcy but not as limiting? You’re in luck!!! There is a substitute. It’s called an Individual Voluntary Arrangement. Also known as an IVA, it is an agreement between the debtor and their creditors to repay a percentage of one’s debt over a course of the length of the IVA. The length usually is about five years. After the length of the IVA, all outstanding debts are usually written off.

Only a couple people can initiate an IVA. In most cases, the debtor begins the process of starting an IVA. But if the debtor is an undischarged bankrupt, the trustee, official receiver or the bankruptcy courts can kick off an IVA as well. The idea is to protect assets that maybe at risk if one were to file bankruptcy, such as your home and automobile. IVA’s don’t leave as much of a lasting impact as bankruptcy would, and it also gives one a chance to obtain credit after the length of the IVA itself. Although IVA can be just as stressful as filing bankruptcy, in the long run, it looks better than having a bankrupt on one’s credit.

It should be known before starting an IVA that it’s not just paying back a portion of your debts and walking away from the rest. Restrictions do apply and starting off the process usually ranges from anywhere upwards to about twenty five hundred dollars. Most IVA operators require about seven hundred and fifty dollars upfront while working in the rest into the IVA itself. If you are in debt, and are thinking of bankruptcy, consider IVA Advice. It could be the answer to preserving your assets and your future.

Written by Andrew Waldenson. Find the latest information on IVA as well as Individual Voluntary Arrangement

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By Andrew Waldenson

For most people, an individual voluntary arrangement is the alternative to filing bankruptcy. For countless individuals bankruptcy is just not an option, due to whatever reasons such as their job won’t allow it. An individual voluntary arrangement or IVA is an agreement reached by the debtor and his creditors to repay a percentage of their debt over a short period of time. Normal terms are about 3 to 5 years in length. No bankruptcy is on your credit and you pull yourself out of debt in a short amount of time.

For an individual to get started with the IVA process, one must attain an insolvency practitioner, or IP. This person must legally be able to write an IVA and are usually an accountant. Once an IP agrees to create an IVA, they can then apply for an “interim order” from the county court. This stops creditors from starting bankruptcy procedures against the individual. From here an IVA is written between the debtor and the IP. This is sent to all the creditors and they are given a 14 day notice to either attend a “creditors meeting” or agree or disagree with the terms of the IVA. A 75% approval from all the creditors is required for the IVA to take affect. If the IVA is approved, the IP supervises the debtor while paying all the monthly installments.

While a number of IVA’s are approved an agreed upon, for those that aren’t, the individual starts back in the same position they were in before the interim order was given. The debtor must then work out an agreement with their creditors individually. One must wait 12 months before another interim order maybe requested. So carefully look over all of your options before you decide that IVA Advice is the best solution for you.

Written by Andrew Waldenson. Find the latest information on Individual Voluntary Arrangement at: http://www.wilsonfield.co.uk/individual/iva.htm

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