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IVA: Do all my creditors have to agree to the terms?

Atiq — Wed, 27 Jan 2010 14:35:40 +0000

If you owe more money than you can afford to repay and you’re wondering whether an IVA (Individual Voluntary Arrangement) is the best way for you to clear your debts, you probably have a few questions you’d like answered. Of course, an IP (Insolvency Practitioner) would be able to answer your questions, but some questions are quite straightforward – like this one….

Do all my creditors have to agree to my IVA proposal?

If you do decide to enter an IVA – and your IP is confident it’s the right approach for you – you’ll work with him/her to draw up an IVA proposal, which sets out how you think the IVA could work (e.g. how long it would run for, and how much you’d be able to pay).

Your creditors will all have a chance to ‘vote’ on this IVA proposal – and it’s important to note that the proposal doesn’t have to be accepted by all of them.

Your IVA will be able to go ahead if it’s approved by lenders who account for at least 75% of your unsecured debt. So, if you owe £20,000, you’d need to have your proposal approved by creditors who collectively ‘own’ £15,000 or more of your debt. (Note that they may wish to request some changes to your proposal first – you and your IP will have to make yourselves available over the phone so you can discuss them.)

If it is approved by enough of your lenders, your IVA will be able to start. It will become legally binding on all your lenders – not just the ones who approved it, but also any lenders who rejected it, or who didn’t vote at all.

What happens if it’s approved?

Your IVA will begin and you’ll begin making your monthly payments to your IP, who will subsequently distribute money among your lenders as agreed.

Since it’s a legally binding agreement, your lenders won’t be able to change their minds or try to take any legal action against you to try to recover their money – including trying to make you bankrupt – as long as you stick to your side of the agreement. If you do, your outstanding unsecured debt will be written off once the IVA has come to a successful conclusion (in most cases, this would be after 5 years).

IVA: pros and cons

Like any debt solution, an IVA has its ‘pros and cons’. Most people would consider the following to be the most important ones:

Pros

Your outstanding unsecured debt will be written off when your IVA comes to a successful conclusion.
Your payments to your IVA will be set at a level you can afford after you’ve taken your essential expenses into account – so you’ll know they won’t take up money you need for things like your mortgage/rent, utility bills and food.
It’s extremely unlikely you’d lose your home in an IVA (although you may have to release equity from it). In fact, it can help you keep your home, since your IVA payments would be calculated to make sure you could afford your mortgage.

Cons

An IVA lasts 5 years. Bankruptcy could be over in just 1 year (although you’d probably have to make payments for up to 3 years).
You may have to release equity from your home so you can pay more into the IVA.
An IVA will stay on your credit report for 6 years from the time it starts.

The article was written by ThinkMoney.com. If you are considering entering into an IVA or other debt solutions visit the site today.

IVA: Do all my creditors have to agree to the terms? is a post from: Delta Debt Management & IVA Advice

IVA and Debt Management for businesses

Atiq — Wed, 02 Dec 2009 12:19:15 +0000

A major part of businessmen have hard times in the years of setting up their own business. They are trying too many things to find a secure position from that the further progress is possible in a competitive business world. That is why so often entrepreneurs borrow money and take advantages of a good credit, but not all of them can cope with a fact that finally comes the time of paying back. A person should take a loan and a credit that are suitable for that business pattern which a person has accepted. So in case you know that your business will need some time to be out of the debts, then you have to do your best to find the suitable repayment time correspondingly. It also often occurs that within a period of the loan application some businessmen do inappropriate actions and in this case they are much more interested in securing the loan quickly. Such people usually are gotten caught in the immense confusion of the debts.

However there exists help that can be provided by numerous profit making and non-profit debt management companies all over the world. One has to make a well informed conclusion which is based on one’s personal situation. There are plenty of aspects to take into account when you are selecting the right people to have a deal with in the debt management business. The very first and notable factor appears to be the range of the services offered by a debt management company. There are a lot of sides of the matter which a debt management company should take care for you. The representatives of a debt management company have to be able to negotiate without mediators with the client’s credit lenders in order to get a control over a situation.

When you get your credit lenders on bay, you gain enough time to concentrate back on the business of your own in order to gain the so necessary income and to bring money back to pay your loan to the credit lenders. At times either the situation can turn out to be even worse than you expected or the business pattern which you have chosen is defected and thus fail to bring any profit. These are the very situations when a person needs to turn to the debt management companies to have a chance to cope with the bankruptcy and with the liquidation of a business.

So what you should pay attention to when choosing a debt management company is that it is better to avoid the companies which claim to eliminate instantly all your debts, it is simply to good to be true. The reliable and respectable debt management companies cooperate with you in order to help in rebuilding your credit and to teach you how to manage the debts.

IVA and Debt Management for businesses is a post from: Delta Debt Management & IVA Advice

IVA Free Advice – Easy Solutions To Debt Problems

Atiq — Sat, 02 Jun 2007 23:57:25 +0000

An introduction:

An IVA free advice is introduced by the Insolvency Act 1986 as an alternative to bankruptcy. By this people facing serious debt problems makes a proposal to their creditors to solve the problem. If the proposal is accepted by majority of the creditors, then all, debtor and creditors are bound under a contract. Under a standard IVA a debtor has to pay an affordable amount each month into a fund over 5 years.

Prerequisites and other facts:

In order to avail IVA free advice you have to meet certain criteria’s as a debtor. You must have a debt of at least £15,000 owed to three or more lenders. It is important that you should get best advice when IVA is chosen. Also the organization should be professional and independent. It is very important as when you deal with an IVA, you are bound with an agreement for five years. So you should carefully understand various facts and clauses of the deal before choosing an IVA.

Today you can find out a lot of IVA organization offering very lucrative offers, but you should check them well before opting them. Some of the key points that should be kept in mind before going for any IVA organization are as below:

a) The IVA advice you are being offered should be impartial.

b) The IVA advice must consider the perspective of both creditors & debtors.

c) IVA advice should be compliant with appropriate licensing and regulations.

d) Advisers should have IVA and debt management experience.

e) All IVA advice and supervision process and systems should be defined and governed by experienced professionals.

IVA free advice has got great benefits, some of them are

a) The interest rate is frozen.

b) The overall debt is reduced.

c) Legal proceedings are stopped.

IVA Free Advice – Easy Solutions To Debt Problems is a post from: Delta Debt Management & IVA Advice