How Do You Stand To Gain From An Iva - Find Out For Youself!

By Author: Sadhana Dhanyal
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We all know how beneficial is filing for Individual Voluntary Arrangements for a debtor. But do we know how beneficial it is for creditors? Not many of them would be aware of it. Read further to find out how

IVA benefits for creditors!

When you enter into and maintain payments to the IVA, it will demonstrate your commitment to your creditors. You as a debtor; can repay a proportion of your debts by way of a formal legally binding arrangement. For them it will allow a percentage of the debt to be repaid back, with their approval.

When an IVA has been proposed to your creditors, they would have received a comparison to bankruptcy. This shows the creditors what they can receive back from both options. The fees in an IVA, is generally less than bankruptcy. Hence, the return for the creditors in an IVA is certainly better.

When a creditor receives an IVA proposal, they will record the receipt of the proposal and then pass the papers to a specialist IVA department, which is usually within a large national firm of accountants, who vote on their behalf. The accountants then collate claims from their ...
... various creditor clients to submit their votes en mass usually on the day before the meeting.

As a debtor, if you are considering filing for an Individual Voluntary Arrangement, then it is advisable you find out all about it beforehand. You may be having various questions on your mind. The standard question that most of them have is what is an IVA?

It is also known as Individual Voluntary Arrangement. It is a legally binding debt repayment agreement between an individual in debt (debtor) and the people he or she owes money to (creditors). It was introduced by the government as part of the Insolvency Act 1986 an alternative to bankruptcy.

A standard IVA will offer to pay whatever the debtor can afford to contribute each month into a fund, over a five year period. The IVA that is repaid via an IVA is usually less. It is less than the total debt. However, it is accepted as a final settlement by the creditors.

It usually lasts for five years. However, one can complete the IVA in a shorter period too. This is possible if it is possible to produce a partial lump sum. When an IVA has been completed, the supervisor will give a debtor a ‘statement of completion' normally within three months of final payment. Insolvency service will also receive a copy of this.

Sadhana Dhanyal,content developer. For more information: Low Apr Loans


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