IVA (Individual Voluntary Arrangements)
What is an IVA and how to clear your debts in affordable payments with an IVA from PayPlan*
An IVA (INDIVIDUAL VOLUNTARY ARRANGEMENT) is a formal agreement between you and your creditors – the people you owe money to. It works by you agreeing to REPAY A PERCENTAGE of your debt in affordable monthly payments over a given time (typically around five years), and once your final IVA payment is made your creditors agree to write off the rest of your debt.
In some cases an IVA can write off a significant proportion of unsecured debts and should put an end to any demands and threats from your creditors. For many people, it’s the preferred solution as it enables them to avoid bankruptcy, and all the unsettling consequences that come with it.
How does an IVA work?
If you decide an IVA is the right debt solution for you, we will put you in touch with our associated company, PayPlan Partnership Limited. They will confirm your income and expenditure and help you work out how much you can reasonably afford to repay each month after your bills and necessary living expenses.
One you’ve decided on a payment amount, they will then help you to put together a proposal for your creditors. Your creditors will have to approve the IVA before it can go ahead, at least 75% in value of your creditors who vote on your IVA, must vote to accept it, but once they’ve agreed they will not be able to chase you for extra payments or add interest to your payments . An IVA is a formal agreement meaning the terms of your IVA are protected. Once your IVA has been approved, you can then begin making your monthly payments.
Is an IVA right for me?
If you have unsecured debt total of around £7,000 or more, an IVA could be the right choice for you. It’s a practical debt solution that enables you to manage your debt WITHOUT WORRY or despair. As an IVA is a legally binding agreement between you and your unsecured creditors, there’s no chance of any nasty surprises along the way.
Once an IVA is in place, unsecured creditors are unable to add contractual interest or charges to the outstanding debt. So, as long as you keep up your agreed monthly repayments and comply with all other terms of the IVA, after your final payment is made you will receive a certificate showing your IVA has been completed and any outstanding debt will be WRITTEN OFF leaving you DEBT FREE.
The benefits of an IVA from PayPlan
All of your unsecured debt repayments will be combined so you’ll have JUST ONE, AFFORDABLE, MONTHLY PAYMENT to make into your IVA. The costs of managing your IVA are built into the single monthly payment and interest & charges are frozen whilst you are in the IVA.
Easy to set up
An IVA is easy to set up and if you decide this is the best debt solution for you we will refer you to our sister company PayPlan Partnership. They specialise in IVAs and have an AVERAGE APPROVAL RATE OF NEARLY 90%* . They will guide your throughout the entire process and use their expertise in putting together a proposal that is affordable and manageable for you.
Frozen interests and charges
An IVA is a LEGALLY BINDING AGREEMENT between you and your unsecured creditors. You make a commitment to pay an affordable monthly sum and by law, they are not permitted to add further contractual interest charges to your debt. The benefit of a formal agreement means your creditors won’t be able to make threating calls or demands and to make life that litte bit more stress while repaying your debts, PayPlan Partnership will handle creditor communication on your behalf.
Peace of mind
When you make your last IVA payment, you will receive a certificate of completion and the balance of your debt will be written off, leaving you debt free and with a fresh start. One of the benefits of an IVA is that you are guaranteed to be debt free once you have finished making your payments.
How about the ‘small print’?
At PayPlan, we always ensure our clients understand fully all aspects of the debt solutions we advise on. Our aim is to put you in control of your debt, because the sooner you are, the sooner you can start ENJOYING LIFE again.
If you don’t keep to your agreed repayment terms, your IVA could fail. If this happens, creditors can pursue you for repayment of the outstanding debt. They may also re-apply interest & charges, and in some circumstances they may petition for your bankruptcy.
In some cases an IVA may not be approved but we would not advise you to opt for an IVA if we don’t think you would be successful. PayPlan Partnership will also help you write a proposal that will suit both you and your creditors.
Also, if during your IVA you become able to repay 100% of your unsecured debts (plus interest and any charges), you will be required to settle the amount in full.
Your share of any equity in your property is seen as an asset by your creditors. So, if there is equity in your property, you may need to try to release some of it and pay it into your IVA. You will only have to release any equity in your property (normally via a re-mortgage or secured loan) if it is reasonable and practical to do so. If you do have equity in your property but can demonstrate that you aren’t able to release any of it, you will normally be required to pay an extra 12 months’ contributions into your IVA instead.
By embarking on an IVA, you will be entered onto a public register and your credit rating could be adversely affected.
*PayPlan refer clients to PayPlan Partnership Limited and PayPlan Bespoke Solutions Limited for IVAs.
**Average approval rate based for PayPlan Partnership IVA applications submitted Jan-May 2015 is 89%.
How to set up an IVA – Contact us today!
At PayPlan, we like to do things differently. We see debt as a PART OF LIFE so we advise on a wide range of practical debt solutions that help people to deal with their debt and get on with living their life.
The best way to find out what makes us different is to call us free on 0800 280 2816 and have a chat with one of our fully trained advisers. They’ll listen to you and talk about you, your life, your debt and your aspirations. You’ll find them understanding of your situation and helpful in your search for a solution that’s right for you.
If you already think that an IVA is the right choice for you, call our advisers today on 0800 280 2816 for confidential, no obligation advice. And don’t be put off if our advisers are busy helping our other clients, just fill in our online Debt Help form and we will call you back.
More information on Individual Voluntary Arrangements (IVA)
- What is an IVA?
- How an IVA works
- Do i qualify for an IVA?
- Pros and cons of an IVA
- IVA FAQs
- Myths about IVA
For immediate and free debt advice please call PayPlan free on 0800 280 2816 or use our Debt Help Form to submit your debt problem online.
PayPlan client reviews for IVA debt management
Iva was the best thing that we did, it stopped a lot of stress
I would recommend PayPlan to anyone. Great support at every step.
I’ve scored a five because I have complete piece of mind,and am actually paying off my debts, which is important to me at a rate that I can afford due to Payplan, of which I wholeheartedly thank for there advise and help