Harrington Brooks has compiled some general IVA advice for people searching for help about the process of an IVA. It is always advisable to seek advice before taking any steps toward applying for an IVA. Please understand that this is generic IVA advice as each person's individual financial circumstances must be taken into consideration.
The first stage in the process is for us to gather together sufficient information from you to enable us to prepare a proposal on your behalf. For this we will need full details of all of your debts, both secured and unsecured; details of your income and expenditure, and details of all assets you may own, whether they have debts secured on them or not. Once we have assessed your financial circumstances and compiled the necessary documentation, we will prepare an IVA proposal. Our Licensed Insolvency Practitioner will act as your Nominee in preparing your proposal, which means that he acts on your behalf in assessing what is a fair offer to your creditors given your individual circumstances and issues that offer to your creditors on your behalf.
When you are happy with the proposal prepared on your behalf and have signed it we will issue it to your creditors. A date will be set for a Creditor Meeting for your creditors to vote on whether or not to accept your IVA proposal, or perhaps ask for it to be modified.
If the outcome of the Creditors Meeting is to modify your IVA Proposal, we will agree the changes with you, and you are in control of whether you accept them or not. Clearly we will negotiate strongly with your creditors to get the best deal that is fair for them and for you.
Neither you nor your creditors are physically required at the meeting, as agreement will in most cases be reached by proxy and via the telephone. Even though your presence may not be required, we would advise you to be contactable so that you can accept any minor modifications immediately.
All of your creditors, or their proxies, can vote on your IVA Proposal. If 75% by value of those who do actually vote agree to your IVA proposal it, is accepted. "By value" means the votes are weighed by the amount of money owed to each creditor and that the votes are not based on a head count. This will mean that if you owe 75% of your total debt to a single creditor then that creditor will have the casting vote on your IVA Proposal. Similarly, one creditor who is owed 25% of the total debt can block the approval of your IVA if they are not completely happy with it. No matter how many creditors you have, they are all bound by it once it is approved and those who voted against or did not vote at all have no recourse to any alternative recovery action.
If any new creditors should appear after the IVA has started, they are allowed to demand an amount that would be equal to what they would have received had they been included at the beginning of the IVA.
Once your IVA has been approved by your creditors our Licensed Insolvency Practitioner becomes Supervisor of the arrangement and will manage the IVA in the interests of creditors to ensure that you abide by the agreed terms and make the payments required. These payments go into a fund managed by the Insolvency Practitioner and regular payments are made to creditors from the fund throughout the term of the IVA.
It is imperative that you maintain the payments into your IVA; otherwise the creditors could seek to have you declared bankrupt. Your creditors will expect you to honour and comply with the terms of the IVA agreement that you have agreed to.
If your financial circumstances change during the course of your IVA agreement we would advise you to inform your Insolvency Practitioner of these changes so that the payments you make can be adjusted accordingly.
For free expert IVA advice why not complete our or contact us directly at and one of our advisors will contact you with more information on IVAs. Also feel free to read through our articles in our debt information section. |
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