| Don’t necessarily believe all the hype. IVAs are not a foregone conclusion when you apply. We take care to ensure this is the correct solution for your particular situation.
Your creditors will vote to agree or decline the application.
IVA Advantages include:
- A court order will stop any legal action by your creditors
- An IVA is drawn up to meet your situation. Assets such as the family home can be excluded so long as the creditors agree
- Creditors should receive more than they would if you were to be made bankrupt
- Employers and landlords etc are not informed of your situation
- Fixed repayment method (normally 3 or 5 years) at the end of which all your outstanding debts within the IVA are discharged
- If you run a company, the company can continue to trade and therefore provide income to fund the IVA
- Interest and charges are stopped: the spiral of debt is halted
- No stigma or publicity as attached to bankruptcy
- One reduced monthly payment to your creditors
- Providing a set percentage (75% in value of your total debt under consideration) of your creditors agree to the IVA, the IVA is binding on unsecured creditors who voted against the IVA
- Telephone calls and letters from your creditors will stop
- You are not subject to the restrictions imposed on bankruptcy and so can still maintain company director status and obtain credit for the business
- A CCJ will normally be included in the IVA
IVA Disadvantages include:
- Assets are at risk if the creditors do not agree to exclude them
- If you own a property (your home or a property you rent to others) and there is equity available the creditors may insist on your releasing equity to go toward your debts
- If you are unable to release equity to the IVA the IVA may be extended by a year
- If you fail to comply with the terms of the arrangement your home and assets can still be at risk if they have not been specifically excluded from the proposal in the first place
- If an IVA fails as a consequence of you defaulting and not meeting your obligations, it is possible that you will be made bankrupt at this time. Should the IVA fail Face 2 Face Debt Help would negotiate on your behalf to put in place an Informal Debt Management Plan
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