When the bills have mounted to a level where you are living with the fear that you will be forced to go bankrupt, the time has come to ask the question, what is an IVA?
An IVA, or Individual Voluntary Arrangement is a formal and legally binding agreement made between you and those whom you owe money to. You agree to pay a predetermined amount each month for a term of five years. The payment amount is based on a percentage of the total of debt that you have and what your financial circumstances are. Once you have completed the schedule of payments, the remainder of the debt is considered settled and will be written off.
When you are asking the question “What is an IVA?” it is important to understand what it is not.
What an IVA is Not
An Individual Voluntary Arrangement is not a debt management service. Because it is a formal arrangement between you and your creditors, it will require the services of an Insolvency Practitioner. An Insolvency Practitioner is a professional that has been licensed to set up Individual Voluntary Arrangements. An arrangement will be made, based upon your disposable income, to repay your creditors an affordable percentage of the balance that is due to them. Any interest or additional charges will be frozen at the time that the IVA is agreed upon.
Is an IVA Appropriate?
Once you have consulted an Insolvency Practitioner to ask "What is an IVA?” they will help you determine if an Individual Voluntary Arrangement is the appropriate course of action for your particular financial situation. You will be asked a series of questions in order to ascertain what amount you will be able to repay. Proposals will need to be drawn up based on the information collected at which time you will need to review and sign them. They should be returned to your Insolvency Practitioner. An interim order can then be filed with the court. Once the interim order is in place, all legal activity against you by your creditors will cease.
The Creditors Proposal
A meeting of your creditors will be scheduled and attended by your Insolvency Practitioner. It is rare that creditors will actually attend these meetings, but rather they will vote via fax or post. Approval must be obtained by affirmative votes from your creditors accepting the proposal as presented by your Insolvency Practitioner. You will need to have votes from creditors representing more than 75% of your debt in order to receive approval of your Individual Voluntary Arrangement. Anything less and the IVA will fail.
If your proposal receives the necessary votes and your Individual Voluntary Arrangement is approved, the role of your Insolvency Practitioner will not end. Your IP will transition into that of manager, managing the details of your IVA ensuring that the payments are made as they were agreed to and distributed appropriately as per the arrangement specifications. Your financial situation will be reviewed for status changes periodically throughout the term of the arrangement.
Make Your Payments and Clear Your Debt
You simply make your agreed payments on schedule each month for your 60 month term. When you have completed the payments of the arrangement your debt is cleared in full without foreclosure or loss of your property. Any balances that remain unpaid, in some cases up to 65% of the debt owed, are written off and the debt is considered paid in full. You are free to begin again on a clean credit slate.
So if you think that bankruptcy is your only option, ask What is an IVA? You may find it is the solution to a clean credit start without you having to file for bankruptcy.
Start the process, see if you qualify for an IVA
When the bills have mounted to a level where you are living with the fear that you will be forced to go bankrupt, the time has come to ask the question, what is an IVA?
An IVA, or Individual Voluntary Arrangement is a formal and legally binding agreement made between you and those whom you owe money to. You agree to pay a predetermined amount each month for a term of five years. The payment amount is based on a percentage of the total of debt that you have and what your financial circumstances are. Once you have completed the schedule of payments, the remainder of the debt is considered settled and will be written off.
When you are asking the question “What is an IVA?” it is important to understand what it is not.
What an IVA is Not
An Individual Voluntary Arrangement is not a debt management service. Because it is a formal arrangement between you and your creditors, it will require the services of an Insolvency Practitioner. An Insolvency Practitioner is a professional that has been licensed to set up Individual Voluntary Arrangements. An arrangement will be made, based upon your disposable income, to repay your creditors an affordable percentage of the balance that is due to them. Any interest or additional charges will be frozen at the time that the IVA is agreed upon.
Is an IVA Appropriate?
Once you have consulted an Insolvency Practitioner to ask "What is an IVA?” they will help you determine if an Individual Voluntary Arrangement is the appropriate course of action for your particular financial situation. You will be asked a series of questions in order to ascertain what amount you will be able to repay. Proposals will need to be drawn up based on the information collected at which time you will need to review and sign them. They should be returned to your Insolvency Practitioner. An interim order can then be filed with the court. Once the interim order is in place, all legal activity against you by your creditors will cease.
The Creditors Proposal
A meeting of your creditors will be scheduled and attended by your Insolvency Practitioner. It is rare that creditors will actually attend these meetings, but rather they will vote via fax or post. Approval must be obtained by affirmative votes from your creditors accepting the proposal as presented by your Insolvency Practitioner. You will need to have votes from creditors representing more than 75% of your debt in order to receive approval of your Individual Voluntary Arrangement. Anything less and the IVA will fail.
If your proposal receives the necessary votes and your Individual Voluntary Arrangement is approved, the role of your Insolvency Practitioner will not end. Your IP will transition into that of manager, managing the details of your IVA ensuring that the payments are made as they were agreed to and distributed appropriately as per the arrangement specifications. Your financial situation will be reviewed for status changes periodically throughout the term of the arrangement.
Make Your Payments and Clear Your Debt
You simply make your agreed payments on schedule each month for your 60 month term. When you have completed the payments of the arrangement your debt is cleared in full without foreclosure or loss of your property. Any balances that remain unpaid, in some cases up to 65% of the debt owed, are written off and the debt is considered paid in full. You are free to begin again on a clean credit slate.
So if you think that bankruptcy is your only option, ask What is an IVA? You may find it is the solution to a clean credit start without you having to file for bankruptcy.
Start the process, see if you qualify for an IVA