An Individual Voluntary Arrangement (IVA) is a binding contract between you and your creditors which alters the terms for repayment of your debts. Key features of an IVA are:
Once the IVA is approved all your unsecured debts are included even if some of your creditors did not vote or vote in favour of approving the IVA.
IVA proposals typically propose that in return for you agreeing to make affordable repayments to the IVA for a fixed period of time your creditors will write off any unpaid amounts still owing to them at the end of the IVA payment term (typically 60 months).
Once the IVA is approved all creditor action stops and your creditors cannot enforce payment of their debts.
IVAs were created by the Insolvency Act 1986. They must be supported by a licensed insolvency practitioner acting as the ‘ Nominee’ of your IVA proposal and they must be supervised by a licensed insolvency practitioner. The insolvency practitioner must act fairly towards both you and your creditors.