FAQs

Questions

1. What will happen when my IVA agreement is over?
2. What is the minimum number of creditors needed?
3. My IVA has been rejected, how much do I owe you?
4. I live in rented property, will my landlord know about my IVA?
5. What if I cannot afford my IVA payments anymore?
6. Can I keep my bank account?
7. Will people know about my IVA?
8. How long will my IVA last?
9. What is an IVA?
10. How long does it take to set up my IVA?
11. Can I still keep my business?
12. Can I cancel my IVA?
13. What if my creditors do not agree to my IVA?
14. How much will my creditors want from me?
15. What about my credit rating?
16. Will my IVA stop creditors from chasing me?
17. Is an IVA for me?
18. How will my IVA work?
19. What or who is a licensed I.P?
20. Can I apply for an IVA if I have been made Bankrupt or I have a CCJ?
21. Can I end my IVA early?
22. Will my IVA include all my debts?

1. What does it mean when it becomes protected?
2. How long will my Trust Deed last?
3. What if my Trust Deed does not get approved?
4. What is the difference between secured and unsecured debt?
5. Will a Trust Deed clear off all my debts?
6. How do I know if I should get a Trust Deed?
7. Can I arrange a Trust Deed myself?
8. Is a Trust Deed another form of a loan?
9. What happens if I cannot afford my monthly payments?
10. Will my credit rating be affected?
11. How long will it take to set-up a Trust Deed?
12. Is this just an IVA?
13. Will my debts continue to accumulate interest and charges?
14. How do I know I can trust your advice?
15. Will a Trust Deed mean that I lose my house?

1. What is Bankruptcy?
2. Are there any alternatives to bankruptcy?
3. Will I lose my assets?
4. Can I keep my job?
5. Will my debts be written off?
6. Which creditors get paid?
7. How much will it cost me to go bankrupt?
8. Can I keep my current bank account?
9. Will people know I have been declared bankrupt?
10. Can you be discharged from Bankruptcy?
11. What happens in court?
12. How long will my bankruptcy last?
13. Can I declare myself bankrupt more than once?
14. What about my pension?

1. What if my circumstances change?
2. Will I be able to get a plan if I have CCJs?
3. Will my creditors accept this plan?
4. Will my credit rating be damaged?
5. What if I fail to keep up my repayments?
6. Do you charge for this service?
7. How long will I have to make payments for?
8. Does it matter if I am not a homeowner or working full time?
9. Will I have to pay my debts off over a longer period of time?
10. Will you need to check my credit history?
11. Will the plan include all of my creditors?
12. How much will I pay to my creditors?
13. How do I know that my debts are being paid?
14. Is a debt management plan a loan?

Answers

1. What will happen when my IVA agreement is over?

   Providing that all the terms of your proposal have been fully carried out, then your creditors will have no further claim against you meaning that any outstanding debts will be written off.

2. What is the minimum number of creditors needed?

   For an IVA you will probably have three or more creditors.

3. My IVA has been rejected, how much do I owe you?

   In effect nothing, because we specialise in IVAs and we are very successful at getting them accepted by your creditors. This means we can afford to absorb the cost risk of the very few rejections that occur and we do not charge you upfront fees.

4. I live in rented property, will my landlord know about my IVA?

   Your landlord does not need to know about your IVA as long as your rent payments are kept up to date.

5. What if I cannot afford my IVA payments anymore?

   If your circumstances change within the duration of your IVA then you must contact your I.P immediately. It is possible to modify your IVA to reflect this new financial change. If the problem is more of a short term nature, then emergency payments breaks can be taken. However if you miss any payments without permission then there is a strong chance that your creditors will commence bankruptcy proceedings against you.

6. Can I keep my bank account?

   Yes, but if you owe money to the bank where your salary is paid into, they could take all the funds that they receive, such as your wage! One of the many benefits of an IVA is that you can open a new ‘simple’ bank account with a bank that you do NOT owe money to. This ensures that you are remain in total control of your income.

7. Will people know about my IVA?

   Your IVA is a private legal agreement between you and your creditors alone. IVAs are not published in your local newspapers so you should not suffer from adverse publicity, but the information is avaliable on a government website.

8. How long will my IVA last?

   Typically an IVA should lasts for 60 months.

9. What is an IVA?

   IVA stands for Individual Voluntary Arrangement where you pay just one monthly amount to your creditors over a set period of 60 months. After your IVA any outstanding debt is written off. IVAs were introduced by the government as part of the Insolvency Act 1986, and are legally binding on all parties.

10. How long does it take to set up my IVA?

    An IVA is legally complex procedure and is therefore only allowed by law to be undertaken by licensed Insolvency Practitioners. If you act promptly to supply us with information then we should be able to process your application in no more thaan 6 weeks.

11. Can I still keep my business?

    Yes. This is a complex matter but self employed people can undertake IVAs and small companies can do CVAs. If this applies to you then we will can discuss this in further detail with you.

12. Can I cancel my IVA?

    No,  an IVA is as legally binding process. So once it has been set up it cannot be cancelled.

13. What if my creditors do not agree to my IVA?

    Your proposal needs 75% of the creditors (by value of debt owed) to vote in favour. If the creditor (or group of creditors) that refuses your case is/are owed more than 25% of your debt then your IVA application has failed.

14. How much will my creditors want from me?

    There is no exact figure that your creditors will ask for in making the decision whether to accept you IVA proposal. This is a two way decision that must be in interest of both you and your creditors.

    Your creditors want to see that you are proposing a fair payment that is affordable and sustainable for the length of the IVA.
    
    Your creditors will in turn agree to freeze interest and charges and also write off a large proportion of your debt. They will cease all recovery and legal activity, telephone calls and letters.

15. What about my credit rating?

    An IVA will damage your credit rating, but if you have already been missing payments then it will already be effected. Once you have a poor credit rating you will find it harder to borrow more money.

16. Will my IVA stop creditors from chasing me?

    If your creditors are chasing you before your IVA is accepted, then your I.P can apply to court for an ‘Interim Order’ which means your creditors cannot continue with recovery proceedings against you. The Order remains until your IVA proposal is proposed to your creditors.
    
    When your IVA is in place, your creditors are not allowed to take any action against you. They are legally obliged to contact us, as we act as your legal representative. This might take a little time but within a few months you should not hear from your creditors again.

17. Is an IVA for me?

    If you are struggling to meet your current monthly payments, then an IVA could be your best option. If you can answer yes to the following questions then an IVA could be for you.
    
    

    • Do you owe more than £15,000 of unsecured debt?
    • Do you owe this to 3 or more creditors?
    • After you have paid your household bills (including any secured loans) do you have at least £200 per month left over?
    • Do you want to avoid bankruptcy?

     

18. How will my IVA work?

    We will do all the work for you so you don’t have to worry about a thing. Through a series of telephone meetings with you, we will prepare a detailed IVA proposal, which you approve and will be issued to your creditors. If they vote in favour of your IVA, it becomes a legally binding on your contract.

19. What or who is a licensed I.P?

    A licensed Insolvency Practitioner (I.P) is the only type of financial advisor that is seen as an ‘expert’ in insolvency procedures under law. They act as Administrators and Liquidators of companies. Some Insolvency Practitioners choose to provide their valuable expert service to help indebted individuals to solve their financial problems without having to borrow more money.

20. Can I apply for an IVA if I have been made Bankrupt or I have a CCJ?

    Yes. Once you apply for your IVA, your Insolvency Practitioner will notify the appropriate authorities. They will argue on your behalf that an IVA is in the best interest of all parties. If this is accepted then your Bankruptcy will be annulled once your IVA gets approved

21. Can I end my IVA early?

    Yes. If you wish to pay a lump sum into your IVA, then we can arrange a variation meeting with your creditors to offer your settlement figure.
    
    Under normal circumstances this will not happen, but it may be that you inherit a large sum or win the lottery, called a ‘windfall’. There will be a ‘windfall’ clause built in your IVA contract that will require you to pay the money into your IVA. As your creditors have agreed to freeze write off a large proportion of your debt, it is only fair that you come to a new arrangement with them.

22. Will my IVA include all my debts?

    An IVA is a repayment plan which can only be done with unsecured debts. If you owe money which is secured against an asset, i.e. your home, and you fail to meet your contracted repayment obligations then your creditors can take various actions including forced sale of that asset. Therefore no deal can be done with secured debts.

1. What does it mean when it becomes protected?

   This means that no further action can be taken against your account by your existing creditors.

2. How long will my Trust Deed last?

   The average Protected Trust Deed lasts for a period of 36 months.

3. What if my Trust Deed does not get approved?

   Our advisors are here to help you with any alternative debt solution plans.

4. What is the difference between secured and unsecured debt?

   Secured debt works against the assets that you own, meaning that if you fail to keep up on repayments then these may be at risk, items include your home. Unsecured loans are not held against any items.

5. Will a Trust Deed clear off all my debts?

   A Trust Deed will cover most of the debts that you have, but there are some which will not be written off. These include any secured debts such as mortgages, secured loans, student loans or fines.

6. How do I know if I should get a Trust Deed?

   We have tried to provide some more information on this website, but the best cause of action is to contact one of our advisors who will be able to talk you through the best options.

7. Can I arrange a Trust Deed myself?

   No, your Trust Deed has to be handled by a fully-trained Insolvency Practitioner (otherwise known as an I.P or Trustee).

8. Is a Trust Deed another form of a loan?

   No, it is a complex legal process that is agreed with your current creditors to repay your debts. No extra money is borrowed.

9. What happens if I cannot afford my monthly payments?

   It is very important that you contact your IP immediately if your financial circumstances change for any reason. If you do not keep up your repayments then your creditors will start bankruptcy proceedings against you.

10. Will my credit rating be affected?

    Yes, but don’t worry. If you are making monthly payments that are lower than the contracted amount or have missed payments then your credit rating will be damaged.

11. How long will it take to set-up a Trust Deed?

    On average it should take about about six weeks to process.

12. Is this just an IVA?

    In principle, a Protected Trust Deed is the Scottish equivalent of an IVA.

13. Will my debts continue to accumulate interest and charges?

    No, any interests or charges on your current debts will be frozen by your creditors from the commencement date of your Trust Deed.

14. How do I know I can trust your advice?

    You will be dealing directly with a licensed Insolvency Practitioner, who is the only type of financial advisor that is seen as an ‘expert’ under law. They are qualified to apply Insolvency Legislation and act as Administrators and Liquidators of companies. Some choose to provide their valuable service to help indebted individuals to sort out their financial problems without having to borrow more money.

15. Will a Trust Deed mean that I lose my house?

    You will not necessarily lose your house, but any equity will probably be released to help pay off your debts.

1. What is Bankruptcy?

   Bankruptcy is a legal process for those who can no longer afford to pay back their debts, this can be proposed to the court even if you owe as little as £750.

   After the proposal has been accepted, a Bankruptcy Trustee is assigned to sell your assets and distribute the funds accordingly. Once this process starts, creditors can not process any further claims against your current debts.
   

2. Are there any alternatives to bankruptcy?

   There are a number of options to be considered before bankruptcy.An IVA can write off a substantial proportion of your debt and you pay a monthly amount over 60 months. Debt Management Plans may also be a suitable option. For more details please call on 0800 048 1768, or fill in our online Quick Enquiry Form so we will call you back.

3. Will I lose my assets?

   Once your Bankruptcy Order has been approved all your assets will become the possession of your Trustee who has the authority to sell them back to pay your debts. This can include your home, car and high value assets.

    

4. Can I keep my job?

   It depends on the sector of your employment. If you are a member of a professional body then you may have to resign, but check your Terms of Employment which should detail more information.

5. Will my debts be written off?

   Bankruptcy will clear most of your debts but there are debts that cannot be written off. This includes court fines, court debts, student loan company debts and secured creditors.

6. Which creditors get paid?

   Bankruptcy ensures all your creditors will all get paid fairly, although this happens in a certain order in:

   1.  Bankruptcy expenses incurred by the Official Receiver. 
   2. Bankruptcy expenses incurred by any Trustee who dealt with your assets.
   3. Expenses related to any sale of your home, such as estate agents.
   4. Any wages owed to employees for the four months prior to bankruptcy.
   5. Other creditors.

7. How much will it cost me to go bankrupt?

   If you petition for your own bankruptcy then you will have to pay a £150 court fee and a £355 deposit towards the Official Receivers.

8. Can I keep my current bank account?

   No, all your bank accounts will be closed and any money will go towards paying your creditors. You will only be allowed to open a new bank account with permission from your Trustee. With a joint bank account then half of the account funds will be taken.

9. Will people know I have been declared bankrupt?

   Yes, your details are placed within the public domain on the bankruptcy register as well as being published in your local newspaper. Anyone you are financially connectied with, such as your mortgage company, will also be notified

10. Can you be discharged from Bankruptcy?

    Yes, there is a process which releases you from the bankruptcy order.

11. What happens in court?

    Once your order has come to County Court, you will be given a hearing date which you must attend. This will involve a number of detailed analyses regarding your financial status, ending with a decision on whether or not your bankruptcy will be granted.

12. How long will my bankruptcy last?

    If you have not been declared bankrupt before, then the average period is 12 months.

13. Can I declare myself bankrupt more than once?

    Yes, however the minimum bankruptcy discharge period will then be 5 years, and may continue for 15 or more. It is much better to look into alternatives before you declare yourself bankrupt again.

14. What about my pension?

    Any pension payments during your bankruptcy order will be considered as an income meaning that they will be paid to the Trustee.

1. What if my circumstances change?

   If you find are able to pay off more than you have agreed, then we will be able to arrange an alternative payment plan.

2. Will I be able to get a plan if I have CCJs?

   Yes, you will be able to get a debt management plan if you have any existing CCJ’s, and might be able to use the plan to make repayments.

3. Will my creditors accept this plan?

   A DMP is not a legal procedure, so there is no guarantee that your creditors will accept. But if the agreement is beneficial to both parties then it is likely to be accepted.

4. Will my credit rating be damaged?

   A DMP will mean that you will be breaking the terms and conditions of your creditor agreement, meaning it will have an adverse affect on your credit record. However if you are failing to make your monthly payments then your credit rating will be poor.

5. What if I fail to keep up my repayments?

   If you fail to keep up repayments then your creditors will no longer wish to continue to support you and may withdraw their help. If you are struggling to make your payment, talk to your case handler who will advise you on what to do.

6. Do you charge for this service?

   Your initial payment will go towards the costs of setting up the programme and negotiating with your creditors. We then have an ongoing administration cost which is included as part of your monthly payment.

7. How long will I have to make payments for?

   You will have to make payments until your unsecured debts have been repaid in full.

8. Does it matter if I am not a homeowner or working full time?

   Your residential status is not considered when applying for a DMP. As long as you have a surplus of income then it does not matter about your employment status.

9. Will I have to pay my debts off over a longer period of time?

   Most likely but it is important to remember that you will be paying a smaller monthly payment in the longer run, instead of struggling now. It is possible that creditors will freeze interest on your account so you can pay your debt off at a quicker rate.

10. Will you need to check my credit history?

    As we are not lending you any money then we will not need to perform a credit check on you.

11. Will the plan include all of my creditors?

    It should include most of your existing creditors, but there are those which cannot be included. These are known as “priority debts”, meaning that if they are not paid then there will be serious consequences.

12. How much will I pay to my creditors?

    The amount you pay is dependant on your circumstances. You must keep up regular monthly payments so your creditors will not feel the need to cancel your agreements. This is why we will work out a individual payment plan based on your exact earnings and expenditure.

13. How do I know that my debts are being paid?

    Your payments are proportioned on how much each creditor is owed. You will receive a statement showing how much each one is issued. You will receive a quarterly statement showing each transaction that has been made from us.

14. Is a debt management plan a loan?

    No, it is not a loan but a way of consolidating all your repayments into one low cost payment without any further borrowing.