IVA Debt.

An IVA or Individual Voluntary Agreement Debt is a legal debt contract between you and your lending agencies. It is a supervised by a Licensed Insolvency Practitioner, and is meant to be a legal binding between the borrower and the credit to help the borrower avoid the situation of bankruptcy or foreclosure.

The IVA debt enables the borrower to cut down expenses towards paying off debts and clear them over a fixed period. It saves you from bankruptcy by offering a larger repayment towards your debts.

While in an IVA debt, you can even qualify for fresh mortgage loans. This agreement is a private agreement between you and your creditor to ensure protection of your property and job which could otherwise be at risk if you are in a situation of bankruptcy.

An IVA debt is a single manageable monthly debt payment program which has tenure of 3-5 years. With it you can consolidate all your monthly payments into one and finance it till you are completely debt free. An IVA debt can write off up to 75% of your previous debts.

An IVA debt is a realistic scheme that offers you to loan that amount which you can pay off. So it is your willingness and affordability matched together to pay off the debt without any extra financial burden. In its true sense  is more manageable than any other debt.

An IVA debt is applicable to all homeowners, Traders and Partners who wish to rule out the possibility of losing their property in the event of insolvency.

How does an IVA debt Work?

You plead to the court and obtain an interim order to avoid repossession of your property. This Order restricts to creditors from taking any legal action against you. The court also organises for a meeting with your creditors to sort out this problem. 

The following information is gathered and presented as part of your IVA debt file:

1. The nominee's comments on the debtor's proposals;



2. Relevant proposals;



3. Notice of date and location of the meeting of creditors to accept or reject your proposal;



4. A list of your assets and liabilities and your income and expenditure patterns;



5. A background document supporting the culmination of IVA debt situation;



6. A request advising majority of creditors to vote for your proposal on IVA debt;



7. A proxy voting form and a guide to the charges involved in the IVA debt process.

The creditors are found to meet 2-4 weeks after the issue of the circular from the court. The purpose of the meeting is to vote for or against the IVA debt proposal by the borrower. Creditors might request for IVA debt proposals with certain modification in the meetings and then agree to accept those.

Acceptance of an IVA debt depends on 75% of those creditors who are voting for the proposal. All those who have voted will be under an agreement.
When the IVA debt proposal is approved a Supervisor will be appointed. The supervisor, who guarantees the adherence to the proposals, organises the distribution of dividends to the creditors.

After the terms of agreement the borrower is released from all liabilities included within it assuming that he/she complies with the terms of the agreement on IVA debts. Free IVA debt advice could be available from debt help online services that engage professional debt counselors.

Want advice? Go to the Consumer Credit Counselling Service http://www.cccs.co.uk; they are truly independent. The rest are touts for private debt management agencies.