The most common misconception about Individual Voluntary Arrangements (IVAs)
Most people have a general awareness about Individual Voluntary Arrangements (IVAs) from TV advertising or from media reports. The large scale advertising of IVAs is by the “IVA Factories” who provide an excellent service for those individuals who neatly fit the pigeon hole of a typical debtor.
This pigeon hole approach generally assumes that the debtor is an employee with a regular salary who has run up over £15,000 of debt on credit cards and loans.
The off the shelf IVA offered by these factories tends to require a debtor to pay monthly contributions of their surplus income into a scheme for 5 years. In the last year the family home is typically sold or re-mortgaged to release any equity therein.
Gibson Hewitt offer a bespoke service for your particular circumstances. Often the individuals we assist are self-employed, partners or directors. Rather than owing exclusively consumer debt, our typical client’s largest creditor might be either HMRC, a supplier, a call for the repayment of a director’s loan account or a personal guarantee to a 3rd party.
Contrary to popular belief, an IVA need not be 5 years of monthly contributions from surplus income and it does not need to require the sale of your home. In fact the Insolvency Act 1986 which provides the legislation for IVAs offers a completely blank canvas.
You can propose an IVA offering absolutely anything to your creditors so long as it is acceptable to both you and your creditors. Theoretically you could base an IVA on the purchase of some lottery tickets with any winnings being paid to your creditors. However, such an offer is unlikely to be sufficiently attractive to your creditors.
At Gibson Hewitt you will have a face to face meeting with an Insolvency Practitioner themselves as opposed to a commission based salesman. We are regulated by the Institute of Chartered Accountants in England & Wales, (ICAEW) and provide you with the best advice for your circumstances. We will discuss with you what commercially viable offer you might make to your creditors based on our experience and your particular circumstances. The key issue here is that it needs to be more attractive to your creditors than the alternative of you being declared bankrupt.
Aside from the more usual options such as a sale/re-mortgage of a family home, options might include; a one off payment, a gift from a relative, buying time for an orderly sale of a business or other asset, an inheritance or a share of the profits from the on-going trading of your business. We are happy to offer our professional advice on the viability of any offer that your creditors might accept.
Don’t feel pigeon holed by the IVA factories, RING US on 01932 336149 to arrange a meeting with Lynn Gibson and discuss what options suit you.