Individual Voluntary Agreement is an alternative to bankruptcy. This program helps the creditor and the debtor to firm up debt repayment plans. Here, both the parties discuss the debt of the debtor and with the approval of both the sides, an amicable repayment plan is finalised. As per this plan, a debtor has to pay of the debt amount within a stipulated term by making regular payment. It is also an assurance against liquidation of property.
In order to be eligible for an Individual Voluntary Agreement, normally an applicant's debts should be unsecured, the debt should not be less than £15000 and the applicant must have a regular income. It may take around 4- 6 weeks for application and settlement of an Individual Voluntary Agreement program.
During this time, formalities like evidence collecting, fact filing, proposal drafting and sending the information to creditors are done. For the approval of an Individual Voluntary Agreement, it should have the support of 75% of the creditors. The term of period is normally fixed for 5 years. Within this time duration, a debtor has got to pay off the debt.
An Insolvency Practitioner, who is a licensed professional, is involved in IVA. This professional sets the Individual Voluntary Agreement for the client. During the period of the Individual Voluntary Agreement, the financial situation of the client is reviewed regularly to see if there are any changes in the client's circumstances.
Some of the benefits of IVA in the UK are as follows:
Get rid of 80% of debts
Revamp credit ratings
Fixed repayment method at the end of which all the debts are discharged.
End creditors' threatening and payment demands
Get rid of debt within 5 years
Deducted single monthly instalment
Fixed interest rate etc.
Indeed, it is always wise to get an online IVA advice to clarify any confusion regarding an Individual Voluntary Agreement. Online IVA advice can save a client from the trouble of manually visiting Individual Voluntary Agreement professionals. With the help of this agreement, a debtor will be considered debt-free after the completion of one year though the client might not have been successful to pay off the debts in full during this period. The remaining balance which could not be paid of within a year is written off and the client is considered to bear no further debts.
The monthly payments for Individual Voluntary Agreement depend on the monthly income of the client and the total amount of the debts of the debtor. Its monthly payment is not huge, it normally varies from £250 to £300.
A client must be a native of the UK In order to be eligible for the IVA advice in the UK. To strengthen the debt proposal, one must furnish appropriate documents. In the UK, this advice is offered by the IVA professionals and insolvency practitioners as well. But, it is advisable to seek the advice of the professionals.
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