Pareto Money IVAs are now being supervised on 02031 314 226

IVAs Explained

As you are aware there many debt solutions and here at Pareto Money Management Ltd we will not a recommend an IVA unless we believe this is the right solution for you and that you are aware of the the benefits and the consequences of entering into an IVA.

Pros of an IVA

  • Legally binding agreement between you and your creditors
  • Have one affordable monthly repayment
  • Interest on your debts are frozen
  • Be debt free usually in five years
  • Legal protection from further action by your creditors
  • On completion of the IVA, the balance of the unsecured debts are written off

Cons of an IVA

  • You will repay more of your debt through an IVA than you would through bankruptcy
  • You can't take out further credit while your IVA is running
  • Your IVA is entered on a public register
  • You may be made bankrupt if the IVA fails
  • You may have to:
    • Remortgage to release a proportion of the equity in your property
    • Pay a percentage if you earn a bonus or overtime
  • Your IVA will stay on your credit file for a year after its successful conclusion, which may make it more difficult for you to get credit
  • An IVA last typically for 5 years, whereas Bankruptcy you are discharged after 12 months although may still be made to make payments for a period of 3 years into the Bankruptcy.

An IVA is a legally binding contract between you and your unsecured creditors (including loans, credit cards, catalogues, store cards, overdrafts etc) which allows you to repay your debts in affordable monthly payments over a fixed period of time, usually five years. It is arranged through an Insolvency Practitioner and in most cases means that you will be free from unsecured debts within five years.

From the information you provide, we will assist you in preparing a proposal and is then put forward to creditors which will explain why you need an IVA and the reasons for your financial difficulty. The proposal will then be considered at a meeting of your creditors.

At the meeting of creditors, creditors are able to vote on whether to accept, change or reject your proposals - 75% of creditors voting on the day of the meeting must agree to the proposal.

As long as your proposal demonstrates a genuine desire and commitment to repay as much of your debt as you can afford, it is likely that creditors will accept your IVA.

Once your IVA is approved all interest and charges on your unsecured debts are frozen. From the monthly payments you make and after the deduction of fees the remaining balance is then distributed to your creditors by your Insolvency Practitioner in accordance with the terms of your IVA. At the end of the Agreement, and following successful completion, any outstanding debts owed to the unsecured creditors will be written off.

Do You Qualify for an IVA?

  • For Pareto money to consider you for an IVA, you must meet our following criteria and have unsecured debts of over £5,000, owed to 1 or more lines of credit
  • You or your partner must have a regular source of income from either employment, regular benefits or from a regular pension - are you prepared to make payments for the next 5 years to resolve your debts?
  • Do you have disposable income of at least £60.00 per month?
  • If you are a homeowner, your mortgage payments will be taken into consideration as expenditure costs

How do I start an IVA?

First and foremost, give Pareto Money Management Ltd a call on 0151 252 6260. If you prefer you may wish to speak to one of our dedicated IVA advisors who will provide you with IVA advice to make sure the right debt solution is selected for your circumstances.

We will take you through every step of the process, before being passed to our Insolvency Practitioner to handle your case.