What happens if some creditors refuse, and others accept?
 
The many benefits that are associated with an IVA can only be realised if the majority of your creditors accept the terms of the IVA proposal. These terms will be set forward by the licensed insolvency practitioner who manages your IVA. This majority is defined by value of debt, not number of creditors. The great advantage is that this agreement would be legally binding on all the creditors; even the ones who did not consent to the IVA. This is because the creditors who advanced 75% of the original debt are the ones whose votes count.

Creditors use two basic rules when they have to decide whether to agree to an IVA:

They won�t go for it if your outstanding unsecured debts amount to less than �15,000 and the cost of the IVA, as a proportion of the outstanding debt, is too high to be of any economical value to them.

If the monthly repayment is under �200 and the cost of running the IVA would absorb too much of the money coming in to make it useful to them, they won�t vote in favour.

For more information see:
What is an IVA?


 
 
     

 

 
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