 |
| The
majority of people want to avoid bankruptcy
as it effects are financially crippling
not only for the period of the bankruptcy
but far beyond in the terms of credit rating. |
|
In
the majority of bankruptcy cases where
there is a house that has a value more
than its mortgage, whether jointly owned
or not or there are children living in
it, the equity has to be realised, which
may mean that either your wife or partner
has to purchase your interest or it has
to be sold further adding a burden to
your personal relationship.
|
|
| In
some cases bankruptcy can only be the best
advice but the less hailed solution is
the Individual Voluntary Arrangement (IVA)
which was introduced as an alternative
to bankruptcy by The Insolvency
Act 1986. |
| Why
is the IVA not
commonly offered to
individuals facing
financial difficulties? |
| Simply: |
 |
An IVA
is highly regulated by an Act of Parliament
and is less likely to be open to abuse
by those who offer this service. |
|
Only
a Licenced Insolvency Practitioner, belonging
to a recognised professional body, can
act as a Supervisor on your behalf. |
|
The
IVA is not advertised in any newspaper
unlike a Bankruptcy Order. |
|
A private
contract, commonly known as a proposal,
is written on your behalf to deal with
claims of unsecured creditors in accordance
with the Insolvency Act 1986. |
|
Every
consideration is given to the exclusion
of the matrimonial home from the proposal. |
|
A named
Licenced Insolvency Practitioner acts as
Supervisor throughout the term of the approved
IVA. |
|
Fees
are regulated in accordance with the Insolvency
Act 1986 and sanctioned by creditors. These
are set out in the proposal so that you
know exactly who is being paid what, when
and from where. |
|
After
the preparation of the proposal an Interim
Order of the Court provides creditor protection
from debt enforcement and bankruptcy. |
|
All
unsecured creditors to whom the proposals
have been sent, are bound by the Arrangement,
even if they do not agree to the proposal,
if more than 75% of your remaining unsecured
creditors agree to the proposal. |
|
When
the proposals are approved interest on
debts cease from that date. |
|
Those
creditors who are bound by the proposal
cannot petition for your bankruptcy in
relation to the debts in the Arrangement
and also agree to waive the balance of
their debt when the Arrangement has successfully
been concluded. |
|
If your
financial circumstances change beyond your
control the Licenced Insolvency Practitioner
will always be sympathetic and advise you
on the appropriate course of action to
assist you. |
|
| Clearly
the IVA, if appropriate to your circumstances,
due to its very nature and highly regulated
regime, is the best way forward. |
|
For further
help and free advice please email
us.
|
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