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How Can Debt Stop Direct Help Me?
An IVA at Debt Stop Direct ltd.
Our sister company Tudor & Kirk will handle all aspects of your IVA
What is an Individual Voluntary Arrangement (IVA)? An Individual Voluntary Arrangement (IVA) may well be the best option if you are struggling to manage with the pressures of unsecured debts to such an extent that you cannot afford your monthly repayments but at the same time want to avoid bankruptcy!
An IVA involves a legally binding contract made between you and your creditors. In an IVA proposal you will attempt to liaise with your creditors in order to come to a formal agreement whereby you pay back what you can realistically afford (typically between 60% - 70% less than your overall debt).
We here at Debt Stop Direct will arrange for our Licensed Insolvency Practitioner (IP) to assess your financial situation and approach any creditors on your behalf with an IVA proposal, in which they will seek to negotiate a settlement figure for you. Apply Here
In a typical IVA agreement you will pay what you can afford monthly over a five year period. This will be a single monthly repayment into a fund managed by your IP. Once this period is over, your debts will be cleared and you will be debt free. For your creditors, even though they may receive only 25% of the total amount owed, it may still prove more beneficial than pursuing an expensive bankruptcy claim. There are also certain TAX benefits they can redeem that are associated with so called bad debts.Apply Here
Any IVA agreement is legally binding for both you and your creditors. Therefore if you manage to keep up your repayments, your creditors cannot take any further action against you.Apply Here
How does an IVA work?
If you decide to apply for an IVA, one of our professional debt advisors will contact you to discuss your circumstances and to see if an IVA is really the best option for you. He or she will collect all the relevant evidence to your financial and other circumstances to try and build an IVA proposal that will be acceptable to your creditors.
This process is a complex one can take up to 4 to 6 weeks. However, once you've outlined your circumstances and provided any supporting documentation, much of the work will be done for you, although you will of course need to read and sign any documentation drawn up on your behalf.
The finalised IVA proposal will be submitted to both the court and your creditors. There will then be a creditors meeting (usually 2-4 weeks later), where all of your creditors will discuss your proposal. Your IP will act as chairman at this meeting and will formally propose your IVA. Within this meeting your creditors can either accept, reject or modify your proposal, however be rest assured that here at Debt Stop Direct Ltd the IP's we use have a vast level of experience and will only propose a case if in their professional opinion it will be accepted. Apply Here
If in monetary terms 75% of your creditors accept the proposal, the formal arrangement is then made. None of your creditors can go back on the agreement once it has been agreed. All are bound by the terms of the IVA, even if they voted against it or withheld their vote.
Advantages and Disadvantages of an IVA.
- With an IVA you can have up to 75% of your debt written off, and there will be no more interest or charges added. You agree to pay what you can afford in a single monthly payment. After the duration of the IVA, which is usually 5 years, you will be debt free, and your creditors bound by the IVA's terms and cannot recoup any further money from you.
- Unlike bankruptcy, in an IVA agreement, you will rarely have to sell your home and other major assets such as a car. In fact with an IVA you are in a much better position to negotiate any agreed settlement, whereas for bankruptcy your assets are entirely in the hands of the presiding magistrate when your proceedings come to court
- An IVA won’t threaten your career if you are working in the armed forces or practicing in other professions, where becoming bankrupt means that you could lose your licence or your job. Also participating in an IVA agreement will not exclude you from becoming a company director.
- With an IVA you can still run a current account and stand a better chance of obtaining credit when the duration of the IVA is over.
- If your total unsecured debt (e.g. credit cards, loans etc) is less than £15,000 you will not qualify. If you fail to keep to the terms of the IVA your creditors can take further action, and this may result in bankruptcy. The IVA stays on your credit history for one year after the IVA ends. This may affect your credit rating although some lenders view your proven ability to make regular payments over 60 months favourably.Apply Here
IVA (Individual Voluntary Arrangement) FAQ
What is an IVA?
An IVA or Individual Voluntary Arrangement is a negotiated agreement whereby
a person can have up to 75% of their debt written off. In an IVA you agree
to pay a single, reduced monthly sum into a fund that will be distributed
amongst your creditors. IVA's, normally run for 5 years, after which you
will be debt free. The Individual Voluntary Arrangement was introduced
as part of the Insolvency Act 1986, and is legally binding on all parties.
Who can apply for an IVA?
Anyone struggling with severe debt problems and who can no longer meet
their monthly repayments can apply for an IVA. Because of the costs involved,
debts below £15,000 are not normally considered appropriate for an IVA
uk plan. You should also be able to contribute at least £200 a month to
an IVA agreement to stand a chance of a proposal being accepted by your
creditors.Apply Here
Will I be able to keep my home?
One of the advantages of an IVA over bankruptcy is that you are in a better
position to negotiate the distribution of your assets. That nearly always
means that you will be able to keep your home, as opposed to bankruptcy
where a presiding magistrate will very likely sell your share in your
home and other assets, with the proceedings being split amongst your creditors.
Will an IVA cover all of my debts?
An IVA only applies for unsecured debts, such as credit cards, personal
loans, bank overdrafts etc. An IVA will not cover you against debts that
are secured against an asset such as a mortgage or secured loan.
How long does it take to get an IVA in place?
An IVA involves a detailed fact find to determine your EXACT financial and
legal position. To do this we have to collect evidence of your personal
and financial circumstances, prepare all the complex legal paperwork (complex
for us to prepare and for your creditors to read, BUT NOT COMPLEX FOR
YOU BECAUSE WE DO IT) and then to distribute the documents amongst creditors.
Typically, it will take 4-8 weeks from start to finish, to have an IVA
proposal agreed by your creditors.
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