www.debtemergency.co.uk
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Debt Management & Debt Advice Freephone 0800 634 5521
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"In four to six weeks we can have 75% of your debt WRITTEN OFF with an IVA."
© Debt Emergency
Debt Management & Debt Advice
Debt Management & Debt Advice
Q.
"THE IVA PROCESS?"
A.
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Freephone:
0800 634 5521
0800 634 5521
It will ussually take four to six weeks to set up an IVA, it all depends on how quickly the individual can provide necassary information such as copies of statements, payslips and other related documents. The name of this process is the 'Nominee' process, as it requires a named Insolvency Practitioner to carry out the proposal, we work closely with highly qualified Insolvency practioners therefore we can reduce the set up times on our side to minimal periods.
The process of an IVA follows a similar pattern regardless of which practice you use.
An IVA application can be made in two ways:
(1) Individual (single)
(2) Household couple (joint). This 2nd option does not require the couple to be married.
The process of an IVA follows a similar pattern regardless of which practice you use.
An IVA application can be made in two ways:
(1) Individual (single)
(2) Household couple (joint). This 2nd option does not require the couple to be married.
The proces is explaned below step by step:
Initial Fact FindThis document may be several pages long and is often in several parts (schedules).
There are a few basic types of IVA although most of them are very similar: Single (one applicant) or Joint (two applicant, Monthly payments only (normally 60 months), Lump sum only (normally from a remortgage), Monthly payments plus lump sum The debtor is required to read the IVA proposal and then sign it once they are totally comfortable with the contents.
Send proposal to the Creditors
Initial Fact Find
- An interview either over the phone or face to face to establish a clear understanding of the situation, and confirm that an IVA is the most suitable approach by collecting relavant information.
- The Information collected includes: household information, background to the debt, number of creditors, assets, monthly income, monthly expenditure.
- The insolvency practice is required to collect evidence that shows that what they are being told is true.
- This makes sure that the proposed IVA is fair to all the creditors. i.e. that the amount paid each month is the full amount that the individual can afford.
- But it also makes sure that the individual can afford the repayments. i.e. That they are able to live without any discomfort, and that they will be able to keep up the payments over five years.
- Evidence includes : Evidence of the debts (e.g. statements from each creditor), Proof of income (e.g. payslips), Proof of expenditure (e.g. rent, monthly bills, etc.), Value of assets (e.g. property valuation, make/model/year of car, etc.), Formal identification (e.g. passport, drivers licence),
Send proposal to the Creditors
- Once the IVA proposal has been signed by both the debtor and also by the Insolvency Practitioner who is acting as the Nominee, then a copy is sent to each of the creditors.
- Each copy is accompanied by any required background information and a covering letter from the Insolvency Practitioner.
- The creditors are asked to read the proposal and vote on whether to approve it or not. They will also be asked to provide proof of the claim they have for the debt.
- Copies are also sent to the local county court and to the insolvency service.
- The creditors will be given a minimum of two to three weeks to review and then respond to the proposal.
- Often it is a specific department of the creditor that deals with the IVA, e.g. the Collections and Recoveries department.
- Major banks ussually use one of the major accounting firms to help them process all of their IVAs.
- Sometimes it may take a few days for the proposal to be forwarded to the correct department or external firm.
- A specific date and time is set to collect all the votes from the various creditors. The Insolvency Practitioner acts as the chairman of this meeting.
- This is ussually always a virtual meeting where the creditors send their votes in advance by fax or by post. Hence there is no real meeting, it is more of an appointed time to count up the votes.
- Creditors have three choices, either to 'Approve', 'Reject' or 'Approve with modifications'. Some creditors may not vote at all.
- If 75% (by value of the debts) of voting creditors approve the IVA, then it is approved for all the creditors including those who rejected or did not vote.
- If it is undecided the Insolvency Practitioner can put back (or adjourn) the meeting while he communicates between the creditors and the debtor. He can then continue to do this for up to two weeks.
- Once an IVA has been approved, all of the relevant parties must be informed.
- The Insolvency Practitioner sends out a Chairman's Report that documents the voting and the outcome of the meeting.
- The court is also informed and a notice is sent to the Insolvency Service so the IVA can be recorded on the Insolvency Register.
- At this point a new bank account is set up for the IVA into which the payments are made monthly, and the Insolvency Practitioner begins the Supervision period.
