You may have heard of IVAs and wonder how to apply for an IVA. An IVA is a debt arrangement in which you make monthly payments to your creditors. The benefits of an IVA far outweigh its disadvantages. If you have ever considered applying for an IVA, it’s important to keep in mind that the process can be lengthy.
The main benefit of an IVA is that the repayments are affordable. You won’t have to pay more than you can afford. Also, you’ll be protected from future lawsuits from your creditors. Unlike bankruptcy, IVAs don’t eliminate all of your debt. However, if you do end up filing for bankruptcy, your creditors are no longer allowed to pursue you. Even if you don’t have any assets, you’ll have a higher chance of securing an IVA.
Once you’ve submitted your application for an IVA, it’s time to send out a copy of the proposed agreement to your creditors. They have a week to review it. If they’re satisfied with the document, they’ll vote for it. If 75% of creditors approve, your IVA is approved. The other 25% must reject the proposal. This means your creditors must approve of the agreement. However, if your creditors are unhappy with the terms of your IVA, they won’t be able to accept it.
Choosing an IVA is a great alternative to bankruptcy. It allows you to make affordable monthly payments and receive a lump sum as payment. You don’t have to worry about up-front fees, as they’re usually negotiated with your creditors. There are no up-front fees involved, and you’re protected from any legal action. Your finances are monitored and reviewed every year, and your creditors will be notified when your IVA is complete.
Before you apply for IVA, you should determine how much debt you have and whether your assets are worth more than your debt. If your assets are worth more than your total debt, it’s unlikely that they’ll be able to accept an IVA, as the creditors will object to your proposal. The good news is that you can still apply for an IVA if your debt is more than seventy five percent of your total debt.