An IVA is usually a 5 year debt solution and it enables a person to repay what they can reasonably afford from their income each month towards their debt. In order to proceed with an IVA you have to create a proposal which must be submitted by a regulated professional, known as an Insolvency Practitioner.
The role of the Insolvency Practitioner is to assess your income, expenditure and assets and offer the creditors what you can afford. This is the nominee stage – when the insolvency practitioner puts forward your application for an IVA. In the coming weeks, after your creditors get your IVA proposal, there will be a creditor meeting to vote on your IVA. If your proposal is accepted at the creditors meeting then your Insolvency Practitioner will become your supervisor.
Do I have to Stay with the Same IVA Company?
A commonly asked question at the Debt Support Trust charity is, “Can I change my IVA Company during the IVA?”. There are a number of reasons a person may wish to do this but the answer is always the same.
An IVA is managed by the Insolvency Practitioner and you can’t change company without their acceptance. From time to time you may find IVA companies “sell on” their cases to other insolvency companies so your case could pass to another company, but this is perfectly normal and nothing to worry about.
You cannot leave your IVA company once the proposal is in place. If you fail to meet your IVA repayments each month then the IVA company may close your case and any money paid into the agreement will be recouped in fees for the IVA company and any remaining money distributed amongst the creditors. You will still have the outstanding debt to pay.
For example, if you paid into an IVA for 3 years but stopped because you wanted to switch company then the IVA practitioner could cancel your agreement and send you the failure certificate. You could enter another IVA but it would be another 5 year agreement.
Generally Not Recommended
It’s generally not recommended to cancel your IVA midway through because it can mean your debt solution isn’t completed. You then have the debt back to deal with.
Switching IVA companies is not possible during the term of the solution and for the IVA to be completed satisfactorily you have to comply with the requests of your Insolvency Practitioner.
If you would like specific advice on IVA companies you can speak to a charity money advisor at Debt Support Trust on 0800 085 0226 today.