What is an IVA

An Individual Voluntary Arrangement is a legally binding agreement between you and your creditors. The arrangement will normally last 5 years and during this period you will be expected to pay what you can afford outside reasonable living costs.

What is the Purpose of an IVA?
The IVA helps those in financial difficulties to make a formal proposal to settle their unsecured debt within a reasonable timeframe.

All interest and charges will be frozen to 0% and creditors will be prohibited from demanding additional payments.

How does it work?
Once a decision has been made that an IVA is right for you (always seek professional advice from a reputable debt consultant) you will be required to undertake an assessment regarding your current financial situation. Based on the information you have given, a repayment amount will be calculated. For an IVA to be approved, creditors will be called upon to vote either for or against the arrangement.

The IVA will be legally binding. As long as you keep up the repayments, when the term of your agreement is finished, you will be free from these debts regardless of how much has been paid off.

During the period of your arrangement your financial situation will be reviewed annually to see if there has been any change in your circumstances.

Once the IVA is accepted the IP’s role becomes that of supervisor, monitoring the IVA’s progress and ensuring that the terms and conditions that were agreed to at the creditors meeting are properly adhered to.

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It is your responsibility to pay the agreed payments to the IP who will then ensure that these payments are distributed to all creditors on a pro-rata basis until the successful completion of the IVA. It is in the debtors own interest to maintain their payments as failure to pay will almost certainly result in the failure of the IVA.

Upon the successful completion of the IVA you will be considered debt free. Any outstanding balances are written off..

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