IVA Settlement
Introduction to IVA Settlements
When the amount of money you owe is greater than the amount of income you are bringing in, this can cause you a lot of stress and uncertainty about where to turn for help. It is best to take care of a situation like this before it becomes too overwhelming and before your creditors begin to seek legal action against you. There are many options available to help you deal with your outstanding debt and solutions that can be made in the best interest of yourself and your creditors. IVAs, or individual voluntary arrangements are one such option.
Before you make any decisions concerning your debts, you should seek the advice of a licensed insolvency practitioner. They are experienced in the many options available and they can look at your specific set of circumstances to advise you on your best option. IVAs are usually a good way to handle overwhelming debt and they create a manageable IVA settlement where monthly payments are set up. This voluntary arrangement is a legal binding agreement between you and your creditors that can help you avoid the need for bankruptcy.
IVA Creditor Meeting
If you have decided to create an IVA to help you settle your debt problem, the first step would be to have your licensed insolvency practitioner set up a proposal to send to your creditors. Then a creditors meeting will be held where all of your creditors work with you and your licensed insolvency practitioner to determine what the best IVA settlement will be. After discussing your proposal and making any necessary changes the creditors will vote on your final IVA settlement. If at least seventy-five percent in attendance agree then the IVA is approved.
It is possible to consider creating a binding IVA even after you have already successfully completed bankruptcy proceedings. As long as your creditors come to an agreement, this can be done. You will need to contact the court and apply for an annulment of the bankruptcy order. Once this is accomplished, your IVA will become your official debt solution.
IVA Settlement
One of the best benefits of an IVA settlement is that this agreement is binding and once your creditors agree to it they cannot change their mind. Even if they vote no at the meeting, as long as seventy-five percent vote yes, they are all required to accept the terms. Since this is binding, your creditors will no longer be able to contact you for any additional money and they will not be able to seek any legal proceedings against you.
The average length of an IVA settlement is five years but it could take a longer or shorter time to complete. It is vital that you make every monthly payment on your IVA settlement or you risk having the agreement broken and it becoming void. This will likely land you in bankruptcy court which you were trying to avoid. Once the IVA settlement payments are complete, your IVA is completed and you owe no more money. |