A procedure for an individual whereby a scheme of arrangement of his affairs or composition in satisfaction of his debts is put forward to creditors. Such a scheme requires the approval of the Court and is under the control of a licensed insolvency practitioner who acts as supervisor. Insolvency Defined as having insufficient assets to meet all debts, or being unable to pay debts as and when they are due. If a creditor can establish either test, he will be able to present a winding-up petition. For a bankruptcy petition, inability to pay is the only available ground.
A fairly recent alternative to a Bankruptcy, an IVA is not quite so onerous as bankruptcy, and its flexibility will vary according to the individual. It is a way of working with your creditors to provide a mutually beneficial solution without having to undergo the trauma of a Bankruptcy. Although not as onerous as a Bankruptcy it will severely limit the range of Lenders available to you.
At the end the IVA the debtor is considered debt free, even if the debts are not paid off in full – anything outstanding is written off, leaving the debtor free to start afresh.
An alternative to bankruptcy. An IVA is a formal proposal, made on behalf of the debtor by a registered insolvency practitioner, to pay creditors part or all of a debt over a set period of time.
An IVA is a less formal alternative to bankruptcy, and its flexibility will vary from case to case. An IVA will enable an individual to pay the whole of the debt or a part over a period of time. It is a way of working with your creditors to achieve a way forward rather than suffer the stigma of bankruptcy. An IVA is a formal insolvency procedure and was a new concept introduced by the Insolvency Act 1986. It was designed to be an alternative to bankruptcy in that the debtor could avoid bankruptcy or alternatively have a Bankruptcy Order annulled through a voluntary arrangement.
Procedure of an individual where they come to an arrangement with their creditors on how their debt is to be discharged. The procedure requires court approval and is under the control of a supervisor.
An IVA is a proposal to creditors to pay off a proportion of the debts that are owed to them. The idea is that creditors will receive a more beneficial payment than would be likely in the event that the individual becomes Bankrupt. In order for the IVA to become binding, it must be accepted by 75% (in value) of the creditors.
A means of protecting yourself from your creditors by entering into a legally binding agreement supervised by an Insolvency Practitioner.
A contract entered into between an individual (know as the debtor) and his creditors whereby the debtor agrees to pay certain sums to the creditors in settlement of the debts and they agree to accept the payment in full and final settlement. The arrangement normally lasts for between 3 and 5 years. The arrangement provides the debtor with protection from his creditors and binds all creditors given notice of the arrangement. The arrangement is approved if greater than 75% of creditors who vote, vote in favour.
This is a legal arrangement agreed between the debtor and his creditors to repay part of the debts over a specified period of time. IVA's are kept on record for six years from the date of the IVA.
A formal legally binding agreement between an individual who is unable to pay their creditors and a licensed Insolvency Practitioner. The Insolvency Practitioner will put together a form of proposals to the Creditors for approval and administer the IVA. The individual must be resident in England, Wales or Northern Ireland.
A voluntary arrangement for an individual is a procedure whereby the person comes to an arrangement with his creditors in how their debt will be discharged. Such a scheme requires the approval of the court and is under the control of a supervisor.
An IVA is a way of allowing an individual or company to avoid bankruptcy whilst making maximum possible restitution to creditors. A proposal to pay off the debt is put to the debtorâ€(tm)s creditors, 75% of whom must accept for the IVA to become binding. If the debtor fails to meet the obligations set out in the IVA, the Insolvency Practioner who arranged the IVA will petition for the debtor to be made bankrupt. An IVA will show on an individualâ€(tm)s or companyâ€(tm)s credit check.
IVA was introduced under the insolvency act 1986 with the intention of allowing an individual to avoid bankruptcy and make maximum possible restitution to creditors. An IVA is seen as preferable to bankruptcy as the debtor can retain his tools of trade and, in the case of a professional person, continue to practice, or hold company directorships. IVA's can be set up for either a person or a company. An insolvency practitioner petitions the high court for protection for a borrower debtor under an IVA. A proposal is put to the creditors of whom 75% must accept. If this is achieved, the arrangement becomes binding upon debtor and all creditors named in the agreement. If the debtor fails to meet payments under an IVA the insolvency practitioner is likely to petition for the individual to be made bankrupt. Whilst bankruptcy normally lasts for only three years some creditors insist that IVA's last a longer period.
A voluntary arrangement for an individual is a procedure whereby a scheme of arrangement of his affairs or composition in satisfaction of his debts is put forward to creditors. Such a scheme requires the approval of the Court and is under the control of a supervisor.
A procedure where an individual who cannot repay their debt comes to an arrangement with their creditors on how their debt will be repaid.
This negotiated settlement between a borrower and their creditors which allows the debtor to repay a reduced debt in affordable monthly instalments over a fixed period of time, usually five years. The terms of the IVA will depend on your personal circumstances but can ultimately allow for a proportion of the debt to be written off. One advantage of an IVA over bankruptcy is that you will usually be allowed to keep your home if you meet your obligations under the agreement.
A formal agreement between the debtor and his creditors administered by a licensed insolvency practitioner usually in full and final settlement of all debts.
A proposal to creditors for the settlement of the debtor's debts.
This is when an individual, usually through a solicitor, makes arrangements to their creditors to pay a reduced monthly installment over a set period of time. A single monthly payment is calculated based on affordability and paid to the IVA administrators who distribute it to the creditors.
In the United Kingdom, Individual Voluntary Arrangements (IVAs) are a formal alternative for individuals wishing to avoid petitioning for their own bankruptcy.