If your financial circumstances change, for the better or worse, then it is best that you speak with your case handler who will be able to advise you on what to do next.
Yes, you will be able to get a Debt Management Plan if you have any existing CCJ’s or have other adverse credit problems.
A Debt Management Plan is not a legal agreement, which means that creditors do not have to accept it. However, we will do our best to try and negotiate with them, on your behalf.
Yes, your credit rating will be damaged as you are breaking the terms and conditions of your initial repayment agreement with your creditors. However, if you are currently failing to make your minimum monthly payments then your credit rating will already be damaged.
If you fail to make your monthly payments, it is likely that your creditors will no longer wish to continue to support you on your plan and may withdraw their help.
If you are struggling to make your payment, then it is important that you talk to your case handler who will advise you.
Your first month’s payment will go towards the implementation costs and negotiating with your creditors. Then there is an ongoing administration cost which is included in your monthly payment.
This is dependant on the amount that you owe to your creditors. As you will have to continue to make payments until all your debts have been fully repaid.
The monthly amount that you need to pay for your Debt Management Plan is dependant on your circumstances.
You should always pay this monthly amount, as failure to do so might mean that your creditors will cancel this agreement. That is why we work with you to make a tailor made payment plan which is based on your earnings and expenditure.
For a Debt Management Plan, it does not matter about your residential status. All you need is a regular income.
This is possible, but it is important to remember that instead of struggling with your debts now, you will be paying a smaller monthly payment. Also, your creditors may freeze interest and other charges on your account so that you are able to pay back your debt more quickly.
There are debts which cannot be included in a Debt Management Plan. These are called “priority debts”, meaning that if they are not paid then there will be serious consequences, such as not paying your mortgage could result in your house being repossessed.
No, a Debt Management Plan is not a loan as you do no borrow any money from us. It is a way of consolidating all of your repayments into one affordable cost.
Your monthly payments to each creditor will be based on how much each one is owed.
You will receive a statement showing how much each creditor will be issued, and from then on you will receive a quarterly statement showing all the transactions that have been made from us.
No, as we don't lend you any money for a Debt Management Plan, it means that we do not have to check your credit rating score.
An IVA will not be hard work for you, as we deal with everything. Once your IVA proposal has been accepted by your creditors it is legally binding. So all you need to do is make one low monthly payment.
An IVA is a repayment plan which allows you to make reduced payments to your creditors. This can only be done with unsecured debts. As if you owe money which is secured against an asset, such as a mortgage on your home, and you fail to meet the repayment obligations your creditors can take various actions including forced sale of the asset.
But your IVA will cover your unsecured credit commitments such as: overdrafts, credit cards, store cards, personal loans etc.
The typical time scale for an IVA is 60 months.
Yes, you can keep your bank account. However if you owe money to the bank where your salary is paid into, then it is best to change your bank account as they are likely to take all of these funds.
With an IVA you can still open a new ‘simple’ bank account (without a cheque guarantee card or overdraft facility) with a bank that you do NOT owe money to, ensuring that you are in control of your income.
If your circumstances change then you must contact your I.P as soon as possible. They may be able to modify your IVA payments to reflect your new financial situation. If it is a short term problem, then they may be able to grant an emergency payments break.
If you miss any payments without your I.Ps permission, then there is the chance that your creditors can commence bankruptcy proceedings. Successfully completing your IVA is the only way to remain protected from your creditors.
An IVA is a complicated legal procedure which can only be undertaken by a licensed Insolvency Practitioner. Thus meaning that the costs of setting up the IVA are rather high. If you would like more information about how an IVA works, please call us today on 0808 131 0039.
IVA stands for Individual Voluntary Arrangement. They were introduced by the government as part of the Insolvency Act 1986, as a more viable solution to bankruptcy.
It is a legal arrangement with your creditors where you pay just one affordable monthly payment, over a period of 60 months. At the end of your IVA you will be debt free as any outstanding debt is written off.
As long as your rent payments are up to date, then your landlord does not need to know about your IVA.
There is not a specific number that your creditors will ask for in making the decision whether to accept you IVA proposal or not. The proposal should be in the interest of both you and your creditors, and your I.P will help you with this.
Yes, you can. If you wish to pay a lump sum into your IVA, then we can arrange a variation meeting with your creditors to offer it and confirm the final settlement.
At the end of your IVA agreement, if all the terms of your proposal have been carried out, then your creditors will have no further claim against you. All of the outstanding debts will be written off.
You will need at least three creditors for an IVA.
Yes, your IVA will damage your credit rating. But if you are missing monthly payments then your credit rating is already damaged.
Your IVA will allow your credit rating to be repaired more quickly, as when you enter into an IVA it remains on your credit rating for six years. The IVA will last for 5 of these, so there is only one year where you may want to borrow with a poor rating.
Insolvency Practitioners are licensed to practice by one of the following bodies, who ensure compliance and regulate their service:
No, as unlike bankruptcy, the details of an IVA are not published in your local paper. It is a private legal agreement between you and your creditors.
Under an IVA, your mortgage and any other secured payments are prioritised, which means we will ensure that you repay them before your IVA contributions are taken. Therefore your home is protected, unlike in bankruptcy.
An IVA is suitable if you owe at least £15,000 of unsecured debt, spread over three or more creditors. It is the perfect solution if you are considering that bankruptcy may be your only way out of debt. Call us free on 0808 131 0039.
We will always ensure that you get enough votes to get your IVA accepted, and therefore do not normally proceed with a case that would not get sufficient votes, as it is a costly procedure.
To be accepted, your IVA proposal needs 75% of the creditors (by value of debt owed) to vote in favour. If the creditor/s that refuse your case is/are owed more than 25% of your debt then your IVA application will have failed.
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.
Yes. Once you apply for your IVA, your Insolvency Practitioner will notify the appropriate authorities and courts and argue that your IVA is in the best interest of all parties. If this is accepted, then your Bankruptcy will be annulled.
No, once your IVA has been accepted, it is a legally binding process between you and your creditors. So it cannot be cancelled.
An IVA is legally and financially complex and is therefore only allowed by law to be undertaken by licensed Insolvency Practitioners. The average time period for processing your IVA application is 4 to 6 weeks.
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.
When your Trust Deed is "protected", it basically means that no further action will be taken on your account by your creditors.
On average your Trust Deed will last 36 months.
A Trust Deed is a complex legal procedure, so it does vary. But on average it should take about 6 weeks.
If you can no loner afford the monthly payments then you must contact your Insolvency Practitioner immediately. As if you do not keep up your repayments then your creditors can start bankruptcy proceedings against you.
You will not necessarily lose your house, but any equity may be released to go towards paying off your debts.
In principle, a Protected Trust Deed is the Scottish equivalent of an IVA (Individual Voluntary Arrangement).
Throughout your Trust Deed, you will be dealing with a licensed Insolvency Practitioner, who are considered financial experts under law.
We have tried to provide you with detailed information about Trust Deeds on this website. But you are best contacting one of our advisors who will be able to talk you through your options.
Once the term of your Trust Deed is complete, any remaining debt is written off.
No, any interests or charges on your accounts will be frozen from when your Trust Deed is agreed.
Yes, a Trust Deed will mean that your credit rating will be badly affected, but if you are making monthly payments that are lower than the contracted amount or have missed payments then your credit rating is already damaged.
It will cover your unsecured debts. But a Trust Deed will not include any secured debts, such as a mortgage or secured loan.
No, it is a legal process that is agreed by your current creditors to repay your debts. You will not borrow any additional money with a Trust Deed.
Yes it will cost you to go bankrupt, if you petition for it yourself. You will have to pay a court fee of £150 and a deposit towards the Official Receivers costs of £355.
Yes as the bankruptcy order will be advertised in your local newspaper and your details are placed within the public domain on the bankruptcy register. Anyone that you are financially connected with will also be notified.
Once your order has come to County Court, you will be given a court date which you need to attend. The court will go through your financial dealings and decide whether or not to grant you bankruptcy.
Unfortunately, your Trustee has the ability to take your home, unless your partner can purchase your share of the equity. Any available equity will be passed over to your creditors.
Bankruptcy is a legal process for those who can no longer afford to pay back their debts. A Bankruptcy Trustee will be assigned to sell your assets and distribute the funds accordingly. Once this process has begun, creditors can not process any further claims against you.
As soon as the bankruptcy is declared, all your assets will become the possession of your Trustee. The only items that you will be able to keep are basic household amenities and any tools needed for your employment.
You may lose high value assets such as jewellery, shares and any interest you have in your property. And these can be sold without your consent.
Bankruptcy will clear most of your debts, there are still those which are not written off, including:
The average bankruptcy period is 12 months.
Yes, there is a process which will release you from the bankruptcy order.
Any pension payments will be considered as an income, meaning that it will be paid to your Trustee.
There are many negative consequences connected to Bankruptcy. It has a negative social stigma attached, as your details will be advertised in your local newspaper and available online.
You will find it very difficult to get accepted for future credit or bank accounts, and certain career prospects will be closed to you.
No, all of your bank accounts will be closed and any money will be used to pay your creditors. You will only be allowed to open a new bank account with the permission from your Trustee.
You may lose your job, but it is dependant on the sector that you are in. You will need to check your contract Terms of Employment which should provide you with more information.