OK I'm considering an IVA.  How does it work ?

The Insolvency Practitioner will first interview you to ascertain your assets and liabilities, what you can afford to put into the IVA and how you came to get into your current situation.

He (or she) may or may not, depending on whether creditors are taking any legal action against you, obtain a Court order suspending such action while the IVA proposal is being considered.

Once he has all the necessary information he will prepare the proposal which is your intended repayment contract with your creditors, and agree this document with you before sending it out.

He will report to the Court that in his opinion a meeting of creditors should be held. The Court will then order that it be held within a few weeks.

The creditors will all be sent a copy of the proposal a few weeks before the meeting and they will then consider whether to vote in favour of it.

At the meeting, if creditors attend, modifications to the proposal could be put forward and considered. Otherwise the votes in favour and the votes against will be counted to see whether the required majority for approval has been obtained.

If insufficient votes in favour have been received, the meeting can be adjourned for up to 2 weeks while the Insolvency Practitioner negotiates further with creditors to attempt to secure support.

Once a final decision has been reached the practitioner reports to the Court, the debtor and the creditors on the outcome.  If the arrangement is approved, then the debtor and all creditors are bound by it and it commences.

While the IVA is running, the debtor must make the agreed monthly payments to the practitioner (now called the Supervisor of the IVA), who once a year will report to everyone and pay a dividend to the creditors.

At the end, if the IVA concludes successfully, the Supervisor sends out his final report and dividend. He then files a certificate of compliance certifying the successful completion of the arrangement.