Many are impacted by the coronavirus outbreak, but for those in an Individual Voluntary Arrangement (“IVA”), this could lead to greater uncertainty and concern.
We have contacted all our debtors in Individual Voluntary Arrangements (IVAs) and agreed terms for the short term in this uncertain time.
The changes however could have significant impacts for those in IVAs, especially where the proposals are written in such a way that they do not allow for flexibility, reduction in income, payment holidays or the discretion of the Supervisor etc.
Any change from the proposals of an IVA require a variation approved by creditors, and this is still the requirement under the Insolvency Act 1986 (as amended, and enacted). It would hard to known how creditors would vote at this time, when many may be impacted themselves by the outbreak.
Anyone in an IVA concerned, should
We have consulted with all our debtors in IVAs to advise of them of the support they can obtain, those still working have at least 80% of their wages, and fortunately our IVAs allow for a degree of flexibility to reduce payments by 15% without further creditor approval. Our proposals also offer repayment holidays, and as such we see no reason for any our of our Individual Voluntary Arrangements to be breached at this stage.
Lucinda Matkin - Licensed Insolvency Practitioner & Chartered Accountant