An Individual Voluntary Arrangement (IVA) is a debt solution where you agree with your creditors to pay all or part of your debts. This agreement is set up and managed by an Insolvency Practitioner (IP), who will receive an agreed, affordable monthly IVA repayment from you and will divide it amongst your creditors.

If you apply for an IVA, then this agreement could allow you to write off up to 85% of your total debt based on government legislation and will often give you a greater level of control than bankruptcy.

Once your IVA has been agreed and set up, your creditors can no longer act against you and won’t be able to contact you, but it will affect your credit rating for six years, making it difficult to get further credit during this period. Your details will also be placed on The Register of Insolvencies, which is a public record, while you clear your debts.

For the duration of your IVA, all fees and interest relating to your debt is frozen and once completed, the remainder of your debt is written off, allowing you to begin again, debt free.

This agreement is available to residents of England, Wales and Northern Ireland. If you live in Scotland, then you could pursue an agreement called a Trust Deed to help you with your debt.

Shortly after filling in our online form, a member of our team will contact you. Our experienced advisors will be able to guide you through your options, ensuring that, even if we cannot help you ourselves, we will always strive to point you in the right direction of help appropriate to your personal circumstances. It is important to us that you receive the best debt help and advice possible, ensuring you have the best possible chance of successful debt management.

After you have spoken to a member of our team and decided that an IVA is the best option for you, your application will be passed over to an IVA Drafter. At this stage of the process, all of your personal and financial details will be gathered in order to create your IVA Proposal.

IVA Proposal

Your IVA Proposal is a formal document that is sent to your creditors. This gives your creditors a complete picture of your financial circumstances.

During the IVA application process, there are several documents that we will request.

We will ask you to provide:

• Photo ID
• Rent Agreement or Mortgage Statement
• Latest 3 Months of wage slips
• Latest 3 months of bank statements
• Council Tax and Utility bills
• HP agreement if appropriate
• Details of the debts to be included in the IVA plus recent statements from any other creditors you may have.

Which information you are asked for will largely depend on your personal circumstances and as such, the above list is to be used purely as a guide.

There will also be a discussion regarding your other living expenses, such as food bills and travel expenses. This allows your IVA Drafter to determine your affordability, ensuring you don’t commit to an IVA that isn’t appropriate for you.

Once all of the information has been gathered, your IVA Drafter will then ‘draft’ your IVA. This means that they will raise the legal documentation.

The Drafter will check through the information you have provided and will ensure that everything is in order to successfully proceed with your proposal, including making sure that all the evidence of your circumstances are available should your creditors request more details.

The Meeting of Creditors (MOC)

The Meeting of Creditors (MOC) is the process by which your creditors vote in favour of, or against your IVA Proposal.

It isn’t an actual meeting, but instead refers to a period of time in which they have to respond to the proposal.

All of the creditors included in the IVA are entitled to vote, however they do not have to. In fact, any creditors that choose not to vote are in effect, agreeing to the proposal. So, any creditors who do wish to reject the IVA Proposal, must actually vote against it.

The IVA Proposal needs 75% of the creditors to vote in favour to be accepted.

or

Enough creditors to vote in favour who make up 75% of the overall debt amount.

Once the proposal has been accepted, the IVA becomes binding for all of the creditors involved, regardless of whether they voted for or against.

What Can Go Wrong with My Proposal?

Of course, there are circumstances where creditors do vote against an IVA Proposal and it does get rejected, however many IVA companies get to know the habits and behaviours of creditor companies and are often able to predict when this might happen, allowing them to modify the proposal accordingly.

Creditors will occasionally question any spending that is above government parameters. This means that if your food bill is higher than average, your creditors may require justification for this.

In some circumstance, creditors may request that modifications be made to the proposal, so instead of it being rejected out of hand, it can just be changed.

An IVA typically lasts for 60 months or 5 years, but in some cases, this can be extended. It is possible to get your IVA cleared in a shorter time by initially providing a lump sum of money.