IVA Monthly Payments

Monthly payments made for an Individual Voluntary Agreement are usually done through a bank account set up specifically for that IVA. The payments may either be a direct debit or standing order.

The bank account used for the monthly payments are set up and controlled by the Insolvency Practitioner or IP who oversees the IVA.
This allows the IP to keep the payments separate from other IVAs, as well as give him the capacity to move the money in and out of the account easily.
The IP checks the account monthly to ensure that payments have been made into the account as it is imperative that payments are made consistently and on time once creditors have approved an IVA.

Some IVAs may include a lump sum payment...

These payments are usually done at a specified date, perhaps three to six months after an IVA has been approved.

It is important to contact the IP when making lump sum payments to discuss the options on how to make the payment. A lump sum payment is typically given to the IP, either through a cheque or electronic transfer, who will add then deposit the payment into the bank account set up for that specific IVA.
If the debtor fails to make a scheduled payment or is finding it difficult to make a payment, he should contact the IP immediately.
It is essential to keep up the monthly payments once the IVA is approved and until it has been fully accomplished.
Standard terms are set up in most IVAs that specify what will happen if a debtor misses a payment. For example, an individual may be required to default to bankruptcy if he misses a certain number of payments based on the terms of the IVA.

Some individuals may be required to forward a copy of their payslips to their IPs every month, or for a certain period of maybe three or six months.
An IP is also required to review the individual’ss income annually. This review typically includes a run through of his income and expenditures.
These steps are done to ensure that the monthly payments for the IVA are still affordable for the individual, and to determine whether the required payment is to be decreased or increased.
If significant change happens in the individual’s situation that may affect his finances, the IP will have to be contacted immediately to discuss the changes. The IP may request for a variation meeting with the creditors; however, it is not guaranteed that the creditors will agree to any changes on the IVA once in place.
The IP is there to help out regarding IVAs and financial circumstances, so it is best to maintain contact with the IP to avoid any problems in the future.