IVA Protocol Agreement Reached Yesterday

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The Insolvency Service facilitated a series of discussions and yesterday a voluntary code of conduct has been agreed between the organisations and bodies involved in managing and agreeing individual voluntary arrangements (IVAs).

The Insolvency Service has facilitated a process which has successfully produced a voluntary code for IVAs to reflect the changing needs of the market. It will provide greater transparency for creditors and debtors alike by using standard clauses and a consistent format. Today's protocol is a significant achievement for everyone involved.

IVAs give individuals the opportunity to pay off their debts in a affordable manner. Mostly, individuals in this situation may have had only bankruptcy as an option. But with an IVA people with crippling debts can agree or go into an agreement with their creditors to pay the debts off, usually over 5 years. The repayments are negotiated in such a way that they are more manageable to the client. This helps the individual avoid the possible stigma of bankruptcy, and allows the creditors to hopefully get their money back, which may not be the case if the person is forced into bankruptcy.

The voluntary code ensures that the process of going into an IVA safeguards the individual to make sure it is the correct choice and option for the client. It should go along way to making the whole process more transparent, and the client will be made aware of the standard terms and conditions.

Many individuals may not even be aware of what an IVA is. The latest results form The Debt Counsellors debt survey shows that out of the 358 who have taken part, only 59% knew what an IVA was. When it is considered that the majority of people taking part in the survey, could be people seeking some financial help, it could show that on a national scale, many individuals just don't know what an IVA is.

With record numbers of insolvencies, professional advise if often sough, and usually trusted. This could be one reason for such a protocol, making the whole process clearer.

Patrick McFadden, Minister of State for Employment Relations and Postal Affairs said
"The Insolvency Service has facilitated a process which has successfully produced a voluntary code for IVAs to reflect the changing needs of the market. It will provide greater transparency for creditors and debtors alike by using standard clauses and a consistent format. Today's protocol is a significant achievement for everyone involved."

To find out more about how The Debt Counsellors can help reduce your debt burden and how to become debt free in 36-60 months, please call: 0800 018 6018 or visit http://www.debtcounsellors.co.uk

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Kevin Aston
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