IVA Articles
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IVA : What Is An IVA Proposal?
Should you be looking for information about Individual Voluntary Arrangements (IVAs), you will regularly see references to the term 'IVA Proposal', and, because our mission here at myIVA-Adviser.com is to keep you as informed as possible, we thought we should give you a clearer idea of what an 'IVA Proposal' is.
But first, here's a brief description of what an Individual Voluntary Arrangement (IVA) is, and the stages required to be undertaken before the Individual Voluntary Arrangement (IVA) proposal stage arrives.
An Individual Voluntary Arrangement (IVA) is a legally binding agreement which allows a person who is suffering serious debt problems ( a debtor ), an opportunity to repay the debts to their creditors at an affordable amount each month. An Individual Voluntary Arrangement (IVA) runs for a prearranged time period, which is normally (but not always) 5 years, and after the Individual Voluntary Arrangement (IVA) has been successfully completed, the creditors are obliged to write off any remaining outstanding balances, thus leaving the person completely debt free.
Once the debtor has decided that the Individual Voluntary Arrangement (IVA) is their preferred choice of debt solution, they will have to find an insolvency practitioner to act on their behalf. Once they have instructed the Insolvency Practitioner, the Individual Voluntary Arrangement (IVA) preparations can begin.
If you are struggling to find an Insolvency Practitioner, then may we suggest you consider our 'in house' Insolvency Practitioner, here at myIVA-Adviser.com.
The next step is for the Insolvency Practitioner to take all details relating to the debtor's circumstances.
These will include:
- All the details of the debts.
- All the details of the creditors involved.
- The accommodation status of the debtor.
- The details of any assets, savings, and equity of the debtor may have available.
- The employment details of the debtor.
- A full income and expenditure financial statement of the debtor.
- The details of the debtor's financial history and how they found themselves in their financial situation.
The insolvency practitioner will collect all this, and any other relevant information, and collate into the Individual Voluntary Arrangement (IVA) proposal.
The IVA proposal is the term used to describe the document which carries all the details of the 'offer' being made, or proposed, to the creditors. It is a perfect method and opportunity for a debtor to explain their circumstances to their creditors, and tell their side of the story.
A new monthly payment will be calculated for the Individual Voluntary Arrangement (IVA), the details of which will appear in the IVA proposal. The Individual Voluntary Arrangement (IVA) proposal is used to demonstrate to the creditors that the payment is achievable for the debtor to afford and maintain, whilst still offering a reasonable return for the creditors. Take this link to learn how we calculate the payment.
When finalised, the proposal will then be presented to the debtor, giving them a chance to check all the details are accurate. Once satisfied that all the details are correct, the debtor will be asked to sign the Individual Voluntary Arrangement (IVA)proposal and return it to the insolvency practitioner.
After the Individual Voluntary Arrangement (IVA) proposal has been returned, the next phase of the Individual Voluntary Arrangement (IVA) preparation can begin. This is known as the Creditors Meeting.
If you have any questions about Individual Voluntary Arrangements (IVAs) or the Individual Voluntary Arrangement (IVA) process, why not call myIVA-Adviser.com for free on 0800 088 7503 anytime, and ask one of our Individual Voluntary Arrangement (IVA) specialists.
