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What are the Costs Associated with an IVA ?

An Individual Voluntary Arrangement (IVA) is a very popular way of managing your debt problems. Simply put, this is because the fees are normally less than those of a court and Official Receivers fee’s that would be involved should you declare yourself bankrupt. This is therefore seen as the best option for both the debtor and creditor. When it comes to the costs of an IVA these will be paid through nominee’s fees and supervisors’ fees. The nominee’s fees are those for setting up and proposing the IVA and the supervisors’ fees is, as it says, the fee for supervising the running of the IVA.

You may feel that initially the costs of an IVA are too expensive but it is important to remember that the people involved in this process will have to do a lot of additional work to make sure it runs successfully. These jobs will often include providing the client with the advice and information they need, preparing the proposal to send to the creditors and then preparing and filing the Nominee's report.

The cost of an IVA

When your IVA has been approved you should find that any additional costs and fees will be paid effectively by the creditors. The main reason for this is that the Insolvency Practitioner (IP) has to be paid for the work that they have done and the creditors will usually accept these fees being taken out of the funds that are being paid into the IVA. This is of course providing the IP's fees are reasonable. It is therefore important that these fees are acceptable otherwise the creditors may reject the IVA proposal, so make sure that you choose a company that will not charge excessive fees.

The costs of the nominee’s fees are usually around £2500 + vat and the supervisor’s fees will often be around £1000+ vat. These prices can vary depending upon the company and can be much less then this in some cases.

If you are considering an IVA then contact a professional for advice and guidance.