IVA – a viable debt consolidation option in Lichfield

Lichfield, a city in Staffordshire, has a population of about 30K and if you take a statistics you would find that many of them are financially struggling with the weight of debts on their shoulder. Their debts are not too big an amount but are considerably significant when it comes to repayment. For such unsecured debts, it is not wise to risk all their assets and go for bankruptcy. In such cases, the other most viable option without much of an impact on the debtor and his status would be opting for an IVA (Individual Voluntary Arrangement).

An IVA in Lichfield is a proposal that would be put forth by the debtor as a solution, when a situation comes that he cannot repay the entire amount. In this the debtor makes it clear that how much maximum he can repay, of the outstanding unsecured debts. This amount is derived after calculating the debtor’s assets, liabilities, his income, and setting aside an amount as expenditure for himself and family maintenance (this would include his food, clothes, rent and other utilities).

An IVA Licensed Insolvency Practitioner is approached for this who would then prepare the required proposal. The debtor authenticates it by signing it and then the IP would put it forward to the court for its record and processing. The court then, if required, provides an Interim Order in favor of the debtor.

The next step would be to inform the creditors. The Insolvency Practitioner does this by way of sending a copy of the proposal. The creditors are given a time frame of 15-21 days to analyze the proposal and are asked to attend a meeting on a particular day to decide about it. On the stipulated day, the debtor also has to attend the meeting. The discussion then goes on. If any different of opinion is found and a consensus is not reached upon, a voting is held. If 3/4th of the creditors vote in favor of it, the IVA is said to be through and comes into effect and the same is intimated to the court.
The monthly payment that the debtor has to make in an IVA should be done to the Insolvency Practitione only and not make any direct payment to the creditors. It is the responsibility of the IP to make the payments to the creditors. And the process goes on till the given date. In the meantime, the IP makes periodical review of the payments, the debtor’s status etc. and prepares reports. If he finds any change in the debtor’s financial situation necessary action is to be taken. If his situation improves, the debtor is asked to contribute more towards the repayment and if his situation worsens further, the creditors are called upon and informed and an amicable solution is then brought upon.

Once all the IVA payments are made, the IP prepares a final report and submits it to the court, which then makes a note of it and issues a Completion Certificate in favor of the debtor. It is important that the IP has to inform this to the Credit Rating Agencies because they would have already been informed about the insolvency and further initiation of IVA upon the Debtor. Once the completion report is sent to these Agencies, they update the status of the debtor as ‘successfully completed’. This would be displayed on record for 1 more year and then the debtor is completely free of debt.

Why IVA should be opted?
An IVA (Individual Voluntary Arrangement) is a intermediary solution without much of a negative impact on the debtor.
IVA it is more suitable when the person doesn’t have a huge amount as debt.

The debtor is not forced to pay anything more than he can afford to. This gives him much relaxation.
He need not pay the affordable amount as a one-time settlement. He can spread it across over a period of up to 60 months on a monthly basis. This gives him a breather and sufficient time to gather and gear himself up.
He can carry on his usual business, or even a professional career. The income through this would contribute towards his debt repayment.
His insolvency would be kept as a guarded secret and not disclosed in public This would help him to be his usual in the society.
Once the IVA is put into effect, the debt amount is sealed off and no further interest would be levied on the debt amount.
The creditors cannot take any legal action against the debtor and hence the debtor is safe from other types of legal entangles relating to debt.

Unlike bankruptcy, the debtor can retain the home property. And also he has more freedom to decide on what asset he needs to put up on the IVA in lieu of the debt amount for the creditors.
The cost involved in IVA is comparatively less than that in a Bankruptcy.
But be cautious when dealing with an IVA. You need to provide actual data and figure because it is a legally binding scheme. If later on any data is found to be fraudulent the debtor may have to face criminal charges.
Use the prudently, wisely and honestly and become a debt free person in the best possible way.
For further debt advice and assistance contact any of the Debt Management Services operating in Lichfield. Below are a few of them:

Citizens Advice Bureau: 139-144, Lichfield St, Walsall, West Midlands WS1 1SE, Tel: 01922 700600
Dains Address: St Johns Court Wiltell Road LICHFIELD Staffordshire WS14 9DS, Main Tel Number: 0800 298 3899, Main Fax Number: 0845 555 8844, Website: www.dains.com, Insolvency Practitioner Tel: 01543 263 484
IVA Advice Line , 12 Lichfield Business Village The Friary Birmingham West Midlands WS13 6QG, Tel :01543 308625

Debt Management UK, Lichfield Business Village The Friary Lichfield Staffs WS13 6QG, Tel :01543 308624

Debt Advice Line, Unit 12 Lichfield Business Village, Lichfield, WS13 6QG
Tel: 0800 389 6339

For Online help you can call at the Helplines of
The UK Insolvency Helpline call on 0800 074 6918.or log in at http://www.insolvencyhelpline.co.uk/debt_advice_uk/lichfield.php 

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