Is this standard pratice?

[stew]

I have been told that I can qualify for an iva,I owe 31,000 and have been told that I would have to pay £252 for 5 years then remortgage for £8,500 in year 4. I have been told that I will have to pay £252 x2 to this company for passing my details to someone else. Is this standard pratice? Also what happens if my creditors do not agree to the iva? Thank you

[MelanieGiles]

No - this is not standard practice, at least in terms of the equity release. Your IP needs to work within the guidelines set down under the recently introduced IVA protocol, of which they should be fully aware.

You are clearly working with an IVA packaging company rather than an IP firm directly. There are advantages and disadvantages of doing this - the advantage is that your IP will receive a pack of documents prepared by the packaging company and enable him/her to work on the IVA proposals straight away, the disadvantage being that you pay for their costs.

I work with a couple of reputable packaging companies, and have to say that they make my life a lot easier, so if you are happy with the service then there is no problem so long as all payments are actually properly disclosed within the proposals. But if they are giving you advice along the lines of remortgaging for a set amount during a final year I would be wary.

[Cybus]

I am interested to know ...

You have been told that you can qualify for an IVA.

I wonder at this stage, have you also been advised of the advantages and disadvantages of not just the IVA, but the other alternatives that are available to you?

Even though the packaging company might say that the IVA is right for you, I think the IP would still have a responsibility to verify the information provided to them in coming to that determination.

I am not questioning the integrity of the packaging company, I am just curious about the process you have gone through so far.

The £252 x 2 that you are paying to this packaging company, is that in addition to contributions that would be paid into a voluntary arrangement or would they be deducted from the contributions that you might pay in to the arrangement?

In putting an IVA proposal forward to creditors on your behalf an IP has to consider:-

Is it feasible?
Is it fair to the creditors?
Is it an acceptable alternative to formal insolvency?
Is it fit to be considered by the creditors?
Is it fair to the company/debtor?

If, after all that, the proposal is not accepted, there are still the alternatives that would have been discussed previously that will remain open.