What is an Individual Voluntary Arrangement, IVA?
An IVA is a process of clearing your unsecured debts such as, credit and store cards, personal loans, payday loans, bank overdrafts and mortgage shortfall following house repossession.
We help you work out what you can afford to pay each month. Once approved then all interest and charges will be stopped and you are protected from any legal action from those lenders that feature in your IVA.
According to your circumstances you could be debt free in 5 years, to find out if you qualify then telephone 0800 197 8433 8am - 9pm or complete the rapid response form and we will call you.
The key points of an IVA & Five Step Guide
Key points
* Pay back a percentage of your debt
* Interest and charges frozen
* No upfront fees
* You can include credit & store card debt, overdrafts, payday loans
* More control over your assets and house than in a bankruptcy.
Five step guide
Step 1
First your circumstances will need to be assessed to see if an IVA is right for you and that no other debt remedy is possible.
Step 2
Working on the basis that you are able to propose an IVA then our trusted 3rd party, Payplan, will then draw up your 'proposals', based on the information you provide. The person overseeing the IVA will be known as the nominee.
This will be your IVA proposal in which you will put forward to your unsecured creditors/lenders your best offer of repayment based upon what you can afford.
The payments could be monthly or just a one off lump sum or both. If monthly payments then this will usually be for a period of 60 months (5 years). You won't have to deal with this by yourself; you will be assisted by our trusted 3rd party who for nearly 20 years have been helping thousands of people successfully propose IVAs.
Step 3
Every one of your creditors will now be sent a copy of your proposal inviting them to vote to accept or reject your offer of payment. If more than 75% of your creditors by value accept then your IVA is approved. It will legally binding on both you and the creditors and will include those that were in the proposal but did not vote or rejected the offer. You are not usually asked to attend the meeting, it is held at the office of your appointed firm.
Step 4
Now that your IVA has been approved all you need to do is make the payments as agreed. Your nominee will now become your supervisor and correspond with you throughout the term of the arrangement. Your creditors will now correspond with the IVA firm and not deal directly with you.
Step 5
Once you have made all the payments that you previously agreed to do then you will receive a ‘Completion Certificate’, confirming that you satisfactorily concluded the IVA. Any outstanding debt in the IVA will be written off.
Advantages and disadvantages or Pros and Cons of an Individual Voluntary Arrangement (IVA)
Choosing the best debt management solution to suit your circumstances can be difficult and confusing. What’s best, a debt management programme an Individual Voluntary Arrangement, IVA, or bankruptcy?
Before jumping into any of these debt management options it makes sense to first investigate the advantages and disadvantages or Pros and Cons of each.
So what are the advantages and disadvantages or Pros and Cons of an Individual Voluntary Arrangement (IVA)?
Take me to the IVA Pros and Cons
Individual Voluntary Arrangement (IVA) Fees
There are two types of fees within an Individual Voluntary Arrangement, IVA; they are Nominee’s fees and Supervisor’s fee. Both the Nominee and the Supervisor will be a qualified Licensed Insolvency Practitioner, often referred as an IP.
The Nominee’s fee
You need an Insolvency Practitioner, IP to prepare the proposal who will known as the Nominee.
The Nominee’s role is to approve your IVA for the benefit of your creditors / lenders.
The Nominee’s fee will cover the initial work to get the proposal to creditors meeting standard, which will include;
- Confirming your income and expenditure
- Drafting the Individual Voluntary Arrangement, IVA proposal
- Corresponding with your lenders / creditors to establish the amount of claims
- Serving notice and of and holding a meeting of creditors
The Supervisor’s fee
As soon as your creditors / lenders accept your Individual Voluntary Arrangement, IVA, then the Nominee becomes your Supervisor.
The Supervisor’s fee covers work including;
- Collecting contributions and agreeing creditor claims
- Making quarterly distributions to and making annual reports to creditors as to how the IVA is running
- Dealing with correspondence and queries from creditors and the client
- Closure of the IVA and making the final dividend payment to creditors.
Who pays the fees?
Every IVA provider will charge both Nominee and Supervisor fees, the scale of IVA fees are set by your creditors / lenders. The nominee fee is likely to be in the range of £750 to £2500 depending on the amount of debt you have, how much you can afford to pay each month into the IVA and the number/mix of your creditors.
Be careful as some firms will ask for the Nominee payment upfront BEFORE they hold a creditors meeting, with the insolvency team supporting debtwizard.com you will not be asked to pay upfront fees instead they will be drawn from your monthly contributions. There will be no additional cost.
The Nominee will also charge additional expenses known as disbursements. Again these will be drawn from your contributions into the IVA.
Warning: If your Individual Voluntary Arrangement, IVA fails, fails you will remain liable for the balance of your debt and the insolvency practitioner may look to recover fees and costs incurred. Although this is extremely rare and DebtWizard or our trusted 3rd party, Payplan, will not pursue you for the fees. However under the Office of Fair Trading (OFT) Debt Management Guidance we are oblighed to make you aware that this may happen with other firms.
Debtwizard.com believes in providing an ethical and transparent service, you can view in more detail how the website is funded and the fee arrangements for an Individual Voluntary Arrangement (IVA) - Fees
In this section we list the most common questions and answers to Individual Voluntary Arrangements, IVAs such as;
Is there any publicity in an IVA?, What happens to my house in an IVA?, How does my employer view an IVA?, Do creditors still charge interest on my liabilities in an IVA?
How do my creditors say yes or no to my IVA proposal?, Can I end my IVA early; does it have to be for 5 years?, Debts not covered by an IVA plus lots more.
Take me to IVA Information
Can debtwizard help decide if an IVA is right for me?
To find out if you qualify for an Individual Voluntary Arrangement (IVA) then telephone 0800 197 8433 8am - 9pm or complete the rapid response form and we will call you.
Remember if we can help you propose an IVA then you will not have to pay up front Nominee fees, instead the fees are taken with the creditors consent from contributions that you pay into the IVA. More on fees and how debtwizard.com is funded - here
Need more IVA information or have a question about the pros and cons of an IVA? Visit our forum
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