If you’re seeking an affordable way to pay off your debts, an IVA could be right for you. An IVA is a formal agreement between you and your creditors to repay the money you owe over a set period of time. Although this type of solution requires you to follow a strict budget, your payments will be fixed. Your creditors won’t be able to harass you for money either. Read on to find out how to set up an IVA UK.
Find an Insolvency Practitioner
The Insolvency Act declares that an IVA can only be set up through a licensed Insolvency Practitioner (IP). The IP has several different roles to fulfil during the course of your IVA, firstly acting as an advisor to you and helping you to finalise the terms of the agreement. At Debt Assist UK, we can help you to find a regulated IP who can set up your IVA UK.
Applying to the court for an Interim Order
To prevent your creditors from taking action against you whilst your IVA is being arranged, your IP may apply to your local county court for an Interim Order. This is a Court Order that forces your creditors to cease legal action for the enforcement of any unsecured debts. It also prevents them from getting a court order against you or trying to making you bankrupt. Once the Interim Order is lodged, the effect is immediate.
Discussing your finances and repayments
The next step when setting up an IVA UK is discussing your finances and repayments with your IP. They will carefully assess your financial situation, including your spare monthly income, assets, and savings. Certain assets, such as your car, may be included in your IVA to help raise more money to pay back your debts. Your IP will help you determine a repayment plan that’s affordable for you.
Drawing up your IVA proposal
Your IVA proposal is the document that shows your creditors and the court how you and your IP think that your IVA should work out. You’ll agree to repay your creditors either in part or in full over a specific period of time, usually three to five years. The document should show them that an IVA really is the best solution for tackling your debts. Your IP will help you to write your IVA proposal and prepare a report for the court.
Creditors either agree or reject your proposal
The next stage is for your IP to call a creditors’ meeting. This is when your creditors vote on your IVA Proposal. If enough of them agree to the terms you’ve set out, your IVA will go ahead. Once the meeting is over, all creditors are legally obliged to accept the decision, whether or not they accepted it or not. The outcome will be reported to the court. You don’t need to attend the meeting, however, you will need to be contactable on the day.
Although setting up an IVA UK is usually fairly straightforward, you will need to find a registered IP. Contact Debt Assist UK today to learn more about how an IVA can help you to pay off your debts in an affordable manner.