The IVA Procedure in Laymans Terms

It has to be determined that you meet the criteria for an IVA and an Insolvency Practitioner (IP) will decide this. He will then determine how much you would be able to realistically pay monthly into your IVA.

Quite often by the time, individuals seek out debt help they are already headed into legal proceedings. If you have agreed to enter into the IVA, then the IP may petition the courts to delay proceedings until the IVA has been considered.

Once the IVA has been prepared and you have agreed to it the IP has to recommend to the Courts that the IVA be presented to the creditors in a meeting.

Prior to the creditors meeting, they will have each received a copy of the IVA and will have to decide whether they will want to vote in agreement of it or disagreement.

There will be a specified number of favourable votes required to put the IVA in motion. During the meeting, modifications can take place but all parties would have to agree to any changes.

If there are some creditors who have voted against the IVA to result in not enough favourable votes then the meeting can be adjourned for a maximum up to two weeks. This gives the IP a chance to further negotiate wit those creditors who are against the agreement.

It then goes back to the meeting. The outcome either way goes before the Courts again. If the IVA has become accepted then once signed, all parties are bound by it.

You will no longer be making payments to the individual creditors as your IP now becomes the supervisor, all payments will be made to him, and he will allocate the funds according to the agreement.

It’s very important that you understand all aspects of the IVA before agreeing and signing. Once you do, it now becomes a legal and binding document.