What is an IVA Agreement?

An IVA Agreement is a way of solving your debt problems. It can be quite difficult to understand so we have simplified the basics so you can clearly comprehend what one actually is.

An Individual Voluntary Arrangement is a legally binding arrangement with all of your creditors through which you are able to repay your debts at an affordable monthly rate over a fixed period of time. This period time is usually five years although it can vary slightly.

Your offer for your arrangement is put forward to your creditors in a special document known as a proposal. This proposal explains exactly why you need the arrangement. This proposal is then lodged into court and your creditors will also receive a copy. If your creditors have warned you that your assets are at risk an Interim Order can be applied for .This means that your creditors cannot start or continue with any action against you or your property unless the court has agreed to this happening. At this point a meeting of your creditors will take place to see if they agree to the arrangement or whether they want to alter or reject your proposals. For your proposal to go through you need acceptance from at least 75% of your creditors.

It is very rare your creditors will reject your proposal. In fact, if you show a genuine desire to repay as much as you can feasibly afford it is very likely your creditors will all accept the arrangement. When employing a company to put together your proposal they will be realistic and explain to you what amounts are likely to suit your creditors and get you a positive outcome.

Once your arrangement has been approved all interest and charges incurred on your unsecured debt will be frozen. If your creditors have accepted that you will only be repaying a proportion of your debt then the remaining balance will be written off as long as you comply with the terms of your arrangement. Another positive of this type of arrangement is that homeowners need not worry about repossession and they ensure your creditors cannot take action against you or your property.

An IVA Agreement is a common and smart option for anybody with mounting debts that need managing quickly. If your debts are becoming too much, consider an Individual Voluntary Arrangement to keep your creditors content and keep the stress out of your personal life.




For more information on an IVA Agreement, or other debt solutions check out our site and see what IVA debt help we have available.