An IVA usually lasts for 5 years, during which time monthly repayments are made to creditors through an Insolvency Company. Sometimes it is possible to propose an IVA that consists of just one lump sum payment which is used as full and final settlement towards the debts. This IVA is referred to as a Lump Sum IVA or a full and final IVA. You might be able to gain access to a lump sum from family or a remortgage or a policy that is due to mature.
To offer a Lump Sum IVA you must qualify for an IVA under the normal criteria.
You must have
The process of a lump sum IVA is similar to the five year IVA only over a shorter time period. A meeting will be organised between the Insolvency Practitioner and yourself to establish your circumstances. The insolvency practitioner will need verification of certain things and will request substantiating documentation. The IVA proposal will then be drafted and forwarded to you for signature. Once the signed proposal is received by the insolvency practitioner, it will be forwarded to all creditors for their consideration.
Once the IVA has been accepted by your creditors, both you and the creditors will be bound by the terms of the arrangement, until the arrangement is completed, which means that the creditors can no longer pursue you for the debt involved.
If the lump sum is paying off only a percentage of the overall debts, then once the IVA is complete, the remainder of the debt will be legally written off and you will be debt free.
An IVA is considered as an alterative to bankruptcy and creditors will very often receive a much higher return in an IVA than bankruptcy so they will generally vote in favour of it. Fees for a lump sum IVA are generally less than five year arrangements as the IVA usually only last for a year or so. All IVA fees are agreed by creditors.
For more information on IVAs contact us at McCambridge Duffy or give us a call on 0800 043 3328.
Call now on 0800 043 3328 or fill in the form on this page if you are interested in applying for a "lump sum IVA".
To find out if McCambridge Duffy can help you regain control over your finances before matters are taken out of your hands, simply get in touch and we will advise you on all options available for dealing with your debts.
" McCambridge Duffy have been great, completely open, honest and non-judgemental from the first phone call. Kept me fully informed through every stage, always did exactly what they said they would and always got back to me promptly. Fully recommended."
Work out what your new monthly IVA repayment could be by filling in our debt and budget calculator form.
In the IVA example pictured above, our client was struggling with payments of £600 per month to their creditors. We were able to reduce the payment to £240 per month. After 60 months of paying this reduced amount, their IVA will be complete. Any remaining debts will be written off and they will be able to start over debt free.
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