An IVA or Individual Voluntary Arrangement is designed for customers who are able to make payments to their creditors but who are unable to pay the full balance owed.
An Insolvency Practitioner will act on a customer's behalf and submit proposals to the customer's creditors for how to pay off the customer's debts. A meeting of creditors would then take place to vote on whether to accept or decline the IVA proposals. If 70% of the debt is approved by the creditors, then the plan will be approved. IVA’s typically run for 3 – 5 years after which if the plan is maintained, the remaining balance is written off by the creditors. A customer will make payments to the Insolvency Practitioner, usually monthly, who will then distribute dividend payments to the creditors on behalf of the customer. If payments cease, or are late, the plan may fail.
A Trust Deed is the Scottish equivalent of the IVA, and is managed by a Trustee appointed by the customer. The arrangements are very similar, one difference is that creditors have 5 weeks to accept or reject proposals.
If you are going though an Insolvency or Trust Deed, please get in touch with us. We need details so we can ensure we have the right information to support you.
We need:
• Your case reference number
• Name, address and contact details of your insolvency Practitioner or your Trustee
• Details of any appointments or meetings you have arranged with them
Once the insolvency or Trust Deed is confirmed, please ask your Practitioner or Trustee to send us the formal documents. These are needed so we can update your account to reflect the outcome of the insolvency you've applied for.
If you have a credit card with us, we need to make you aware that under our credit card terms, there are some circumstances where we can suspend or end the use of your credit card. These include when you are going through an insolvency.
We may think these options are best for you and will help you avoid getting into further debt. We will also update your credit file to reflect this information. This information will be shared will credit reference agencies and will be visible on your credit file for 6 years.