How will an IVA help me?

1. Can reduce your debt by up to 60 to 70%.

An IVA can often write off up to 60 to 70% of your debt. This means you only make affordable repayments according to your personal circumstances.

1. Be debt free in 60 months.

You can reduce your repayment period to 60 months meaning after the 60 month period you will be debt free, the rest will have been written off. This is provided you maintain the repayment schedule and is based on the approval of the 75% reduction.

1. No more interest and charges.

The interest and other charges will be frozen meaning your debts will not increase.

1. Stops hassle from creditors.

You won't have to worry about being chased up by debt collectors and creditors anymore.

1. Avoids court action.

This can stop a bankruptcy procedure being enforced and also stop bailiffs.

1. Do I have to pay set up fees?

There are set up fees involved with an IVA but these are deducted from the money owed to your creditors and there will not be an additional fee added to your monthly repayment.

Debt write off applys only where an IVA is suitable, adhere to and at the end of 60 months and applied to unsecured debts included in the IVA. Alternative solutions may be offered. Failure to adhere to an IVA can result in bankruptcy. An IVA is a formal agreement and will affect your credit rating for up to 72 months after completion. Homeowners may be required to remortgage in the 4th year of the IVA. Fees apply and will be notified to you in advance.

An IVA may not be favourable if you own your own home, as you have to give up a percentage of your assets and you may be required to remortgage in the 4th year of an IVA.

IVA Q & A

What repayments will i have to make?

This dependent on your personal circumstances and how much disposal income you bring in each month. The monthly repayment will be calculated using you income minus your essential outgoings and an affordable amount will be agreed on. This is usually not below £200 per month.

Am I eligible for an IVA?

To be eligible for an IVA you must have unsecured debts of over £15,000. These should normally be owed to at least 3 different creditors. You must also be able to make the monthly repayments set out in the IVA which normally amounts to a minimum of £200 per month.

Do I have to face my creditors at meetings?

Due to the increased amount of IVA applications that creditors receive nowadays it is very rare that the creditors actually attend meetings in person. They will usually respond via email or fax through their voting decision meaning you won't have to deal with them at all.

Do my creditors have to accept my IVA application?

Your creditors are given the option to reject your application. However, if a 75% majority by value of creditors accept the arrangement, then the minority have no choice but to accept the agreement.

Will it really write off up to 60 to 70% of my debts?

If you adhere to the IVA and keep up the monthly repayments then all debts included in the IVA will be written off at the end of the 60 month period.

How will an IVA affect my credit rating?

During the IVA period you will find it very hard to get consumer credit. The IVA will be maintained on a database during the IVA period and for some time afterwards. This accessible by credit reference agencies so gaining credit after your IVA may prove slightly more difficult but there are specific companies that provide mortgage and re-mortgage services to people who have previously had an IVA so there are options available for you.

I think an IVA is the best option for me - What do I do now?

You will need to contact us either by phone or by filling out the online application form. We will then contact you to discuss your financial circumstances.

1. We prepare all of the documents
2. You will need to give us consent to act on your behalf.
3. When we have received confirmation of this consent we will contact your creditors.
4. We request that your creditors freeze any interest charges and suspend any pending action due to be taken against you.
5. The information that you have provided us with will enable us to draft your offer.
6. You need to check through the proposal to ensure you are happy with it then sign and return it to us.
7. We will the take care of all the administration work that needs to be carried out.
8. There is no need for you to attend court hearings or creditor meetings.

IVA Examples

(Examples based on existing client situations)

Mr Farnby

With debts totaling £28,000 on various credit cards and loans, Mr Farnby was seriously struggling to meet the repayments. His monthly outgoings were towering above his income and the debts were getting larger and larger. Having been declined for debt consolidation loans the only solution left was to apply for an IVA.

After taking the initial steps the IVA was set up and his creditors agreed that he only needs to pay back just over half of his original debt. The interest for all the debt was instantly frozen and the monthly repayments that were decided on meant that Mr Farnby was able to maintain the repayments.

The IVA meant that Mr Farnby was able to reduce his monthly payment down to £267 per month. After the 60 month period Mr Farnby will be debt free meaning that £12,000 of his debt has been written off.

Setting up an IVA

After you initially make contact with us we will discuss your current situation and decide if an IVA is the best solution for you. We would only advise a formal proposal if we think the IVA is likely to be accepted.

1. We will post a questionnaire out to you which will need to be completed and returned in order to gather all of the information needed for one of our advisors to prepare the IVA proposal.
2. You will receive a letter to confirm that you have instructed us to contact your creditors on your behalf which must be signed and returned. This means that we will now begin negotiation with the creditors and inform them of the situation so they should no longer bother you.
3. One of our experienced advisors will produce a draft proposal using the information that you have provided us with. If we require any further information we may contact you to retrieve this. You will be sent a copy of this draft proposal for approval which will need to be returned to us.
4. When you have returned the draft proposal complete with any necessary alterations, we will then update the proposal and return it to you for one final check and signature.
5. A report is then created on your offer to produce to the creditors. We will also lodge this report and IVA proposal in court. This is a formality and will not require your presence in court unless there are exceptional circumstances.
6. A creditors meeting will be arranged in order to discuss the IVA application where we will present your proposal. You are not required to attend this meeting but you may do so if you wish.
7. The creditors will each vote as to whether they want to accept your proposal. If 75% (bu value of the debt) of the creditors agree to the offer then your IVA will be accepted. This IVA is then legally binding to all creditors whether they voted or not.
8. It is possible for a meeting to be adjourned for up to 14 days in order for creditors to review any revised offers if applicable.

How long will it take to set up my IVA?

The following timescale is based upon the average number of days it takes our advisors to process your paperwork and the timescales set by the Court and Insolvancy Act 1986.

The timescale stated does not take into consideration the length of time it takes a client to return paperwork or file paperwork at Court as this varies significantly from client to client.

1. Day 1. Initial contact is made with the company. A Fact Finders pack is sent out to you.
2. Day 7. Return your signed Fact Finder pack back to us.
3. Day 10. Our advisors get to work drafting your IVA proposal and send a copy out to you.
4. Day 15. You check the IVA proposal and return it to us.
5. Day 36. Your IVA proposal will have been agreed!! Congratulations!!
6. Month 60. You are debt free.