Bankruptcy & IVA Information
What is a Voluntary Arrangement?
- A) A formal arrangement made through the court to creditors
- B) An informal payment arrangement between the consumer and their creditors
- C) An arrangement made against the consumer at the request of selected lenders
- D) A formal payment plan between the consumer and one of their creditors
- An IVA is an alternative to a Bankruptcy and has none of the restrictions
- The amount repaid under an IVA is usually a small percentage of the actual outstanding debt
- The majority of creditors must agree to repayments in order for the IVA to go ahead. If the IVA goes ahead, and creditors that did not orginally agree will automatically be included.
- The agreement is binding. Once creditors have received their agreed amount, they must update their accounts to show as paid and closed or partially paid and closed. This includes the creditors who did not originally agree to the IVA.
- Historically, we used to obtain IVA information on a monthly basis from the DTI. We now receive the information from the IS of England & Wales (ISEW)
Why are both the account and the IVA retained on our records, instead of just one entry?
- A) Lenders want to stop the consumer from obtaining future credit by showing both entries on the consumer's credit report
- B) Both entries are important as they make up the consumer's payment history.
- C) The court says we must show both entries on the consumer's report
- D) The account is retained on our records but it no longer appears on the consumer's report once the IVA is granted.