If you want to start an IVA there are a number of steps you have to complete. It is a formal agreement so you will need professional help.
- Complete your Statement of Affairs
- Draft your IVA Proposal
- Supporting Documentation required
- IVA Agreed at Creditor’s Meeting
- Start paying your IVA
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How to start an Individual Voluntary Arrangement
You need professional help to start an IVA. Who is the Insolvency Practitioner and what do they do? Do your creditors have to accept your IVA proposal? When do your IVA payments start? To find out more go to: http://beatmydebt.com/individual-voluntary-arrangement/how-to-start-individual-voluntary-arrangement
Complete your Statement of Affairs
Before you start an IVA you have to complete a Statement of Affairs. This is a summary of your personal financial situation. It includes key information about your debts, income, living expenditures and the assets you own.
The information you provide must be complete and accurate. It will be used to assess the amount you will pay into the Arrangement each month. It will also help you understand the impact on assets such as your home.
Use one of our expert debt advisers to help you complete your Statement of Affairs. We will also introduce you to a suitable Insolvency Practitioner.
Draft your IVA Proposal
Once your Statement of Affairs is complete you will need to engage with an Insolvency Practitioner (IP). This is a professionally licensed personal who will negotiate your IVA with your creditors.
The IP will first review your circumstances. Given they agree that an IVA is a suitable solution for you they will then start to draft your IVA proposal. This document includes your financial information and highlights exactly how much you are proposing to pay into the Arrangement each month.
The Proposal includes a comparison between what the creditors will get from your IVA to what they would receive if you went bankrupt. In this way it is made clear that it is in their financial interests to accept it.
Once your Proposal has been drafted it is posted to you for review. You should read the document carefully. Make sure you completely understand the Proposal and its implications. Once you are happy you must sign and return it to your IP.
Supporting Documentation Required to start an IVA
Before your IP is able to finalise your IVA Proposal you will need to provide various documentation. This is to prove the information you have given. As a minimum you will need to provide the following:
- Copy of photo ID such as a Passport or Driving License
- Recent statements or balances from your creditors
- Recent copies of your bank statements
- Confirmation of your income such as copies of your wage slips or benefits statements
- Your rent agreement or a recent mortgage statement
- A valuation of your property if you are a home owner
It takes an average of 6-8 weeks to get an IVA in place. To make sure it is completed without delay it is critical that you send all the information requested by your IP as quickly as possible.
How long does it take to set up an IVA?
It will take 4-6 weeks to set up an Individual Voluntary Arrangement (IVA). Why does it take this long? What personal information will you need to provide? Is it possible to start an IVA in less time? To find out more please visit: http://beatmydebt.com/individual-voluntary-arrangement/how-to-start-individual-voluntary-arrangement
IVA Agreed at Creditor’s Meeting
Before your IVA can be agreed your creditors must be allowed to review the Proposal. Your IP will send a copy to each of your creditors. They are then given 2-3 weeks to consider it.
At the end of this time there is a Creditors meeting. Traditionally this is where your creditors get together to discuss and agree the Proposal. However they will not normally attend the meeting. They will send a letter or e-mail to your IP to register their acceptance.
Your Proposal will be agreed as long as 75% of the value of the creditors who vote say yes. Given this then even if a creditor rejects the IVA will still legally binding on all of them.
Your creditors can request modifications to your Proposal. Your IP will discuss these with you. If you agree your IVA will be accepted with these changes. You can disagree and make a counter offer or abandon the solution altogether.
Start paying your IVA
Once your IVA is accepted at the Creditor’s Meeting it will start. It is now legally binding on all of the creditors. From this moment they are no longer able to take further action to try and recover the money you owe them.
Your IP will register the fact that the Arrangement has started in the Insolvency Register. You must then begin making the payments as agreed.
The IP will also be appointed as your IVA Supervisor. This job involves monitoring your monthly payments and ensuring you fulfil any other requirements as stipulated in the Arrangement.
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