• Freeze interest and charges on your debt immediately
• Stop contact and demands from your creditors
• Consolidate your debts into one affordable monthly payment
• A clear plan to get you out of debt at a sensible pace
• Free expert help and advice with no obligation or pressure

IVA Explained

Not everyone completely understands what an IVA is and may need the specifics of an IVA explained. An IVA is an Individual Voluntary Arrangement; this is a formal agreement between the debtor and their creditors. The agreement involves coming to an arrangement with your creditors so that you can make a reduced payment. You will have to make this reduced payment for about 5 years and at the end of the arrangement you will have paid off a percentage of your total debt.

Because an IVA is a formal agreement, not just anyone can set it up; a licensed professional must arrange an IVA. There are a number of IVA professionals available to help put together a proposal for your creditors, although some private firms may charge you an upfront fee.

The Mechanics of the IVA Explained

When you seek the advice of an IVA expert, they will ask you several questions concerning your financial situation. Once they have received enough information from you they can advise on which debt solution is best for you, and if that is an IVA. You will work together to make the decision on whether an IVA is the right solution, and once this has been decided, your IVA professional will put together a proposal that can be presented to your creditors.

The IVA professional will come up with an amount that you can pay; this may be a monthly payment or a lump sum payment. You will have to read through the agreement and sign it before it can be presented to your creditors. At this point an Interim Order will be filed with the court so that no creditors can take legal action against you. In addition, a meeting with your creditors will be arranged; it is important that you attend this meeting.

For an IVA to be approved, the creditors that own at least 75% of your debt will have to vote for it. If the creditors owning the majority of your debt vote against it, the meeting will be suspended; at this point they will call upon whatever creditors that did not vote the first time to cast their vote.

Once the IVA is approved, you will have to make monthly payments for about 5 years. As this is a formal arrangement all parties are legally bound to the agreement. If you make your payments as arranged, for the period of time set, you will be free from those debts at the end of the agreement; it does not matter if all of the debt has been paid.

During the time period that you are making payments, your financial situation will be reviewed regularly to compensate for any changes. Your payments may be raised or lowered, according to your ability to pay.