IVA - Frequently Asked Questions

You may still receive calls and letters whilst your IVA is being processed, but as soon as it has been approved they cannot take any further action.

The average time period for processing your IVA application is four to six weeks. For complicated cases it can take longer.

No. You will be allowed to retain such proportion of your income as necessary to meet the reasonable domestic needs of you and your family. Typically this would include food, clothing and household items, rent/mortgage, travel (including car ownership costs), all utility bills, insurance, TV and phone, schooling and childcare costs. It is a matter for negotiation between you and your creditors exactly as to what this will comprise, but creditors will expect you to live fairly economically while the IVA is in place. It is unlikely that they would wish to see money set aside from your income for foreign holidays, a new car or home improvements. Expenditure levels are set by commonly accepted guidelines.

Whilst your IVA proposal is being prepared, the court will be notified which is usually enough to stop proceedings. If this does not happen then your advisor will write to both the court and your creditors.

Yes, but any payments already made will be distributed to creditors who may then commence alternative recovery action, including bankruptcy.

Creditors are becoming very familiar with IVAs, and normally they have a company policy which outlines their stance on IVA proposals. Whilst the IVA is in the process of being drafted, you will be instructed in the correct protocols to follow, so as to give your IVA the best chance of success.

One creditor can stop the IVA if they are owed more than 25% of the debts. If more than 75% of your creditors by value approve the IVA, then any dissenting creditors are bound by the arrangement.

A direct debit will be set up from your bank account to an account held by us that will be used to collect and monitor your IVA payments.

Monthly payments depend upon your disposable income rather than size of debt. This is what you have left with after reasonable monthly living expenses (excluding your debts) are taken from your monthly income. This figure will depend on your personal circumstances and will be agreed between you and your advisor. Normally the monthly payment will not be below £150.

Once the IVA is in place, and while you maintain the agreed payment, you are protected from legal action by the creditors detailed in the IVA.