IVA FAQs
Questions:
- Contact us
- How do I contact Baines and Ernst?
- Credit and creditors
- Will the IVA affect my credit rating?
- Will the IVA prevent my creditors taking further recovery action?
- General
- Can I enter an IVA if I already have CCJs against me?
- Does an IVA cover all of my debts?
- Is this a loan?
- What is the difference between a secured and unsecured debt?
- Will I be credit checked before acceptance?
- Personal circumstances
- Can an individual creditor refuse to accept an IVA?
- Do creditors have to accept an IVA?
- Do I have to be in full time employment?
- Do I have to tell my partner?
- Does it make a difference if I am a homeowner or tenant?
- If I am a homeowner, will I have to release equity in my home into the IVA?
- Time and costs
- Can a creditor take further recovery action before the IVA is approved?
- Can I cancel the IVA once it is set up?
- How are the Insolvency Practitioner's fees collected?
- How long does it take to set up an IVA?
- How long will the IVA last?
- What happens if I just stop paying into the IVA?
- What happens if the IVA is not approved?
- What if my circumstances change?
- Will interest and other charges be frozen while the IVA is being set up?
Answers:
- How do I contact Baines and Ernst?
It's easy to talk to our debt management advice team, simply call on 0800 096 1331, use the 30 second debt test or click here to contact us about IVAs online. - Will the IVA affect my credit rating?
You should expect that your credit rating will be adversely affected by going into an IVA. It will remain on your credit file up to 6 years after completion. - Will the IVA prevent my creditors taking further recovery action?
Yes. Once the IVA is in place, you are protected from all further recovery action by your unsecured creditors providing you agree to the terms of the arrangement. - Can I enter an IVA if I already have CCJs against me?
Yes. Entering into an IVA even offers you a way by which you can avoid further recovery action after a creditor has obtained a CCJ against you. - Does an IVA cover all of my debts?
No. An IVA can only cover your unsecured debts and arrears. - Is this a loan?
No. An Individual Voluntary Arrangement is a legal process whereby you can agree with your creditors to repay them what you can afford. This may result in paying back less than you actually owe. - What is the difference between a secured and unsecured debt?
A secured debt is a debt secured against an asset that you own. Typical secured debts will be a mortgage, a secured loan, a car loan, etc. An unsecured loan is any loan not secured on an asset, such as a bank overdraft, a personal loan, a credit card, store card, etc. - Will I be credit checked before acceptance?
No. Since you will not be borrowing any money, there will be no need for a credit search. - Can an individual creditor refuse to accept an IVA?
Yes, but only if he has more than 25% of the debt voting at the creditors meeting. Once the IVA has been accepted by vote at the creditors meeting, all creditors are bound by law to accept the arrangement. - Do creditors have to accept an IVA?
The decision to accept or reject an IVA is made by a vote of your creditors at a creditors meeting. You need to get 75% acceptance by debt value at that meeting for the IVA to go ahead. If less than 75% by debt value vote to accept the IVA, the IVA will fail. - Do I have to be in full time employment?
No. To enter into an IVA, you only need to have a surplus of income above what you need to live on. - Do I have to tell my partner?
You will almost certainly have to tell your partner if you are entering into an IVA. - Does it make a difference if I am a homeowner or tenant?
No. It makes no difference whether you are a tenant or homeowner or even if you are still living with your parents. - If I am a homeowner, will I have to release equity in my home into the IVA?
You may have to release a proportion of any available equity in any property you own as part of your overall contribution to your creditors. This will usually happen after the 3rd year of the IVA. - Can a creditor take further recovery action before the IVA is approved?
Yes, but you can apply to the courts for an Interim Order to stop any of your creditors taking further recovery action until the outcome of your creditors meeting is known. - Can I cancel the IVA once it is set up?
No. An IVA is a legal process and, once it is set up, you cannot just cancel it if you change your mind. - How are the Insolvency Practitioner's fees collected?
The Insolvency Practitioners fees are collected from the payments you make into the IVA and will be notified of the fees that apply in advance. - How long does it take to set up an IVA?
Providing everything is standard, it takes typically between 6 and 8 weeks to set up an IVA. - How long will the IVA last?
This can vary, but it usually lasts for upto 5 years. - What happens if I just stop paying into the IVA?
If you fail to keep to the arrangement, your supervisor in the IVA (the insolvency practitioner) has the right to apply for you to be declared bankrupt and for your creditors may petition for your bankruptcy. - What happens if the IVA is not approved?
You will have to come to an alternative arrangement with you creditors to repay your debts. We may be able to offer you an alternative solution.
Our Insolvency Practitioners are licensed by the Association of Charted Certified Accountants. - What if my circumstances change?
If you are unable to maintain repayments because of changed circumstances, your supervisor in the IVA can request a variation to reflect your new circumstances. - Will interest and other charges be frozen while the IVA is being set up?
No, but any such interest and charges will be covered by the IVA when it is approved.