Individual Voluntary Arrangement

If you are in need of an Individual Voluntary Agreement our team can offer the very best services and top advice.

Debt management has become much more frequent in the past few years as people strive to seek a positive outcome from getting into too much debt. The reasons why they get into debt are numerous, but the fact of the matter is that ignoring it won’t make it go away.

There is no need to let it go that far when there are so many options to explore for restructuring your debts. One of the most popular solutions is Individual Voluntary Agreement.

There are other options - trust deeds for example https://www.finance-near-me.co.uk/debt/trust-deed/ - however you need to think aboutwhat is best for you.

Individual Voluntary Arrangements, or IVAs for short, have been around since the mid-1980’s and have helped millions and millions of people to successfully restructure their debts into something much more manageable. Let’s go through what IVAs are and their good and bad points.

For more information on this debt solution, please complete out contact form now and we will help you. 

What is an IVA? 

Let’s start with the obvious; what is an IVA? Individual voluntary agreement is something that you enter into freely - it cannot be imposed on you by your creditors like bankruptcy https://www.finance-near-me.co.uk/debt/bankruptcy/ can be. It is where you realise you are struggling with your finances and you appeal to your creditors to make reduced payments.

It’s not just a simple as contacting your creditors and asking them to accept less money from you, there are procedures that have to be followed and criteria to be met.

1. First of all, you must have at minimum of three different debts, and you must have at least two creditors that you owe money to. You must also owe at least £10,000 to your creditors.
2. Secondly, you must enlist the help of an Insolvency Practitioner, more commonly referred to as an IP. An Insolvency Practitioner is your conduit to your creditors - without one, you cannot complete an individual voluntary arrangement.
3. Your IP will contact your creditors and negotiate the terms of the debt solution with them.

You will find that most local creditors would rather receive some money from you rather than nothing at all, and the process allows them to recoup a lot of money that they might otherwise be missing out on if you were to go bankrupt instead.

If you are in Scotland you may consider sequestration https://www.finance-near-me.co.uk/debt/sequestration/ rather than bankruptcy.

This is why an Individual Voluntary Arrangement is usually granted in the vast majority of cases. If the IP does not think that your financial situation will be improved by applying for an IVA then they will suggest alternative methods for you. 

IVA Register

If you want to apply for an Individual Voluntary Agreement then you have to register with an Insolvency Practitioner first. The Insolvency Practitioner will;

• Invite you for a meeting to discuss your options

• Complete a household budget with your help. This is to ascertain how much money you have got coming in versus how much money you have going out each month.

• Once the outgoings have been subtracted from your income you will be left with what is known as your disposable income.

• If they think that you have enough disposable income to make your creditors an offer then they will set up a meeting with them and ask them to vote on your proposal.

IVA Companies Near Me 

There has been a steady increase in the number of companies offering to complete individual voluntary arrangements for people who are struggling with debt. Trying to find IVA companies near me will not be difficult, but the amount that they charge for their services varies drastically.

Once the arrangement has been agreed with your creditors, you will make one monthly payment to your Insolvency Practitioner who will pay your creditors on your behalf. They charge you each month for this distribution and there is also a one-off charge for setting up the arrangement in the first place.

If you would like recommendations for IVA companies nearby you and in surrounding areas that offer a professional service without the huge price tag, contact us by completing the form below. 

Voluntary Arrangement 

A voluntary arrangement is an excellent way to show your creditors that you are trying to be financially responsible. It does, however, need careful consideration as there are some drawbacks that you need to aware of before applying for a voluntary arrangement. 

IVA Pros and Cons 

Pros  An end to interest charges and fees No more correspondence from your creditors One monthly payment to remember instead of several different ones The potential to be debt-free in just 5 years More money for you each month and less stress

Cons  Seriously affects your credit score for up to 6 years You are unable to apply for any form of credit during the first 12 months You will have to pay any lump sums of money to your creditors You may need to change banks if you have accounts with a creditor you owe money to

IVA Advice Near Me 

If you are considering applying for an IVA but need advice then we can help. We can advise you from what can and cannot be included on your household budget form, to recommending the best course of action for your particular circumstances. Please get in touch for any IVA advice you may need and we’ll steer you in the right direction.

How does an IVA Work? 

How does an IVA work? Once your Insolvency Practitioner conducts a meeting with your creditors they must vote on whether to accept your offer or not. As long as 75% of them agree then the agreement will be approved. Even creditors who voted against it must go along with it if 75% agree.

You will then make one payment a month to your IP who distributes this amongst your creditors. They usually last for five years. During this time, all interest, fees and charges are frozen on the various accounts and your creditors are not allowed to approach you for any more.

Once the agreement has been completed, any remaining debt, interest and charges are written off and you will be free of them. Your creditors cannot chase you for them.

Speak To Us 

Speak to us if we can help you with any aspect of an Individual Voluntary Arrangement along with Insolvency Practitioners or help with your household budget. We can recommend firms who specialise in this particular area and deliver outstanding results for the best prices.