A guide to IVAs
IVAs. What are they and do we really need or want one? Here is a great guide to Individual Voluntary Arrangements.
Summary of what an IVA is:
· IVA stands for ‘Individual Voluntary Arrangement’: a legally binding contract between you
and the bank or credit card company.
· Under an IVA, your debts are frozen and you will pay an agreed amount for an agreed amount of time (usually 5 years)
· Once this period is over, all debt (remaining or not) is paid off
· It is a serious step, not to be taken lightly
· Debts usually have to be at least £20,000 plus
How?
An IVA is a legally binding agreement so you can’t set one up on your own. You’ll need
the help of an Insolvency Practitioner (IP), usually an authorised accountant or solicitor,
who’ll look at your situation and do a deal with the creditors for you. After the IVA’s up and
running, it’s their job to supervise it.
You need to be honest about your finances when taking out n IVA. A company such as Churchwood Finance will advise you on your options and help you on the next step to becoming debt free.
You will have your assets and income assets to figure out how much you will be paying per month on your IVA.
An 'Interim Order' will be applied for for you to state that when (or if) your IVA is approved your credits can legally no longer contact you.
What then?
In most cases an IVA will see you paying back 30p for every £1.
You won't have to sell your home, but may have to release equity from it. You are unlikely to have to sell your car. It has no impact on your state pension.
Nomination Fee
There are fees involved in all IVAs.
