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IVA : Payment Problem In An IVA.
Sometimes a payment problem may occur during the term of your Individual Voluntary Arrangement (IVA).
What action can you take to minimise the damage this payment problem may cause?
Individual Voluntary Arrangements (IVAs) depend on regular payments to your creditors.
When you enter into an Individual Voluntary Arrangement, you actually 'guarantee' your creditors will be paid with regular payments, over a fixed period of time.
The payment timetable for the Individual Voluntary Arrangement is agreed at the Creditors Meeting.
When you realise that there is going to be a problem in maintaining the Individual Voluntary Arrangement payments, the first thing you should do is contact your Insolvency Practitioner.
Missed Individual Voluntary Arrangement payments can happen for a multitude of reasons, and its fair to say that some are due to more avoidable problems than others. However, by contacting and informing your Insolvency Practitioner when the problem arises, i.e. as soon as possible, you offer yourself the best opportunity of keeping your Individual Voluntary Arrangement 'on track'.
It is usually written into the IVA proposal that the Individual Voluntary Arrangement will be failed if a client misses in excess of 2 payments over the duration of the Individual Voluntary Arrangement, but this generally is designed to cover the scenario of a client just refusing to make contributions as a matter of choice, and not people suffering with an honest problem with payments.
If a client's circumstances change due to an unforeseen problem, for example, loss of employment, then provision can be made, at the discretion of the insolvency practitioner, to allow the client to temporarily suspend payments for a short period, and then resume payments when the circumstances improve.
The client's Individual Voluntary Arrangement payments would normally be required to be increase for a short time, to catch up on the missed payments that the problem caused, but if this is not possible, extending the term of the IVA may also be a option for the insolvency practitioner to consider.
And so, by keeping the Insolvency Practitioner informed of your on going situation throughout the troublesome period, you massively reduce the risk of your Individual Voluntary Arrangement failing due to your payment problem.
For further information regarding all aspects of Individual Voluntary Arrangements, take the link to read more useful articles on the IVAs
OR call myIVA-Adviser.com for free on 0800 088 7503 anytime to discuss your payment problem with one of our IVA specialists.
