| |
|
|
| |
Frequently asked questions |
|
|
|
|
|
|
|
|
|
|
|
| Q1 |
|
How does an IVA work? |
|
|
|
| A |
|
An IVA can only be set
up with the help of a licensed Insolvency Practitioner (known
as an ‘IP’). The IP has an important role to play
in the process and has a duty to ensure that the proposed IVA
is fair and reasonable to both you and your creditors.
Setting up an IVA basically involves collecting and verifying
information, producing the payment proposal, and a meeting with
the IP and your creditors to consider the proposal.
|
|
|
|
|
|
 |
|
|
| |
|
|
|
| Q2 |
|
What are the effects of an IVA? |
|
|
|
| A |
|
Once the IVA has been accepted, all your creditors
are then legally bound by it. As long as you keep to your side
of the agreement and make all your payments on time and in full,
your creditors cannot change their minds or go back on any part
of the agreement. You are also protected from any legal action
being taken against you by your creditors. |
|
|
|
|
|
|
|
|
| |
|
|
|
| Q3 |
|
Do all my creditors have to agree to an
IVA? |
|
|
|
| A |
|
To approve your IVA, at least 75 per cent by
value of the creditors who vote at a meeting, in person or by proxy,
must accept your proposals. If any of your creditors vote against
an IVA or do not vote at all, they are still bound by the agreement
as long as it has been accepted by a 75 per cent majority. |
|
|
|
|
|
|
|
|
| |
|
|
|
| Q4 |
|
Do I have to attend the creditors’ meeting? |
|
|
|
| A |
|
You do not have to attend, but if your creditors
want to make any changes to the proposal, you will have to agree
them before an IVA can be set up. You can ask for time to consider
any changes, and Freeman Jones will always be able to advise you. |
|
|
|
|
|
|
|
|
| |
|
|
|
| Q5 |
|
How much do I have to pay? |
|
|
|
| A |
|
We will advise you fully about the amount
that you should propose to pay into your IVA. In principle, however,
the payment will be based on your surplus income after allowing
for the living expenses of you and your family. Your creditors
will
usually require that these payments are maintained for five years.
At the end of the agreement, the total payments
you have made will add up to a certain percentage of what you owe
to your creditors. This is called a dividend and can be any amount
between 30 and 100 per cent of your debt. |
|
|
|
|
|
|
|
|
| |
|
|
|
| Q6 |
|
What if I am unable to make my payments? |
|
|
|
| A |
|
We will review your monthly payments on a regular
basis. If you find that you are unable to meet your payments, we
will try to renegotiate the terms of the agreement with your creditors,
although they are under no obligation to agree to this. |
|
|
|
|
|
|
|
|
| |
|
|
|
| Q7 |
|
What happens at the end of the agreement? |
|
|
|
| A |
|
IVAs are usually set up so that whatever payments
your creditors receive over the period of the agreement, these
are considered to be in full and final settlement of their claims
against you.
This means that at the end of the agreement, as long as the
terms of the proposals have been successfully maintained,
the creditors included in the arrangement will have no further claim against you and,
as far as you are concerned, the balance of any unpaid debts
is written off.
|
|
|
|
|
|
|
|
|
| |
|
|
|
| Q8 |
|
Why would my creditors accept an IVA? |
|
|
|
| A |
|
In accepting an IVA, your creditors will expect
to get a better return than they would normally receive from bankruptcy
or any other reasonable alternative, and your payment proposals
should demonstrate this to be the case. Your creditors will also
benefit from the fact that your IVA will be closely monitored and
your finances will be subject to a disciplined procedure. |
|
|
|
|
|
|
|
|
| |
|
|
|
| Q9 |
|
How much does an IVA cost? |
|
|
|
| A |
|
All the costs associated
with your IVA are included in the payments you make in to it.
You don’t pay anything
extra.
At Freeman Jones, we are committed to being totally clear,
honest and fair to both you and your creditors about our fees
and any other costs that may be incurred. We do not pay or
receive any undisclosed fees or commission.
We will fully inform you of our proposed fees before you commit
yourself to an IVA.
|
|
|
|
|
|
|
|
|
| |
|
|
|
| Q10 |
|
What are the effects of an IVA on my home? |
|
|
|
| A |
|
One of the main advantages of an IVA over bankruptcy is that the family home is safe from repossession. As a homeowner, it may be necessary to partially release the equity in your property to help reduce the outstanding balance.
|
|
|
|
|
|
|
|
|
| |
|
|
|
| Q11 |
|
Does Freeman Jones belong to a professional
body? |
|
|
|
| A |
|
Our insolvency practitioners are licensed by either the Insolvency Service (part of the Department of Trade and Industry) or the Institute of Chartered Accountants in England and Wales (ICAEW), and are members of the Association of Business Recovery Professionals (known as R3). All licensing and professional bodies provide technical, professional and ethical guidelines that have to be followed carefully.
More information is available from the
Insolvency Service website at www.insolvency.gov.uk
|
|
|
|
|
|
|
|
|
| |
|
|
