Our calculator will help you to decide whether an IVA is right for you.
An IVA, or Individual Voluntary Arrangement, can be the perfect solution for those who are on the verge of bankruptcy. At such a time, creditors demanding money are often an added headache when you are already about to lose possession of all your assets. Entering into an IVA obstructs all creditors from taking any legal action against you. When talking about IVA and creditors, they both seem to be opposite poles, but on closer scrutiny one may realise that they are actually not as the creditors are still in a beneficial position. Entering into an IVA, and maintaining regular payments to them, will ensure creditors see your commitment for repayment of at least a portion of the debts with the help of a formal arrangement that binds you legally. So, to creditors it will simply permit the repayment of some percentage of debt after their approval.
There are various benefits that an IVA has over that of bankruptcy such as an IVA is not publicised, the assets such as property remain in possession of debtors, and many others. This is why a considerable increase has been noticed in IVA cases. The agreement of IVA is drawn up by a licensed insolvency practitioner. This defines a regular repayment plan to pay back the money that is owed to the debtor. This reduces the overall sum that has to be paid by the debtor and the interest on this amount is also frozen. Consulting a reputable IVA company can prove to be of immense help as a good IVA company will usually provide the facility of answering the annoying letters and calls of creditors on the behalf of the debtor. The fee that has to be paid to an IVA company varies from one firm to the other and so it is better to decide for it beforehand. This will assure debtors the peace of mind even during this stressful time. An IVA generally extends up to a period of five years.
However, even a good IVA company will prove to be of no help if the debtor fails to make the payment into the IVA. The debtor may then be declared bankrupt instead. Also, if the IVA fails the creditors will again have the right to take a legal action against the debtor.