What to do if your creditors continue harassing you during your IVA
The nature of an individual voluntary arrangement (IVA) as a form of debt solution is such that your creditors should not be contacting you directly while it is active.
We’ll help you work out what you should do if your lenders continue to harass you once you’ve officially begun your IVA.
Creditors who are involved in your IVA
In order for an IVA to become official, you need a consensus from the creditor(s) to whom you owe at least 75% of your relevant debts that the agreement is acceptable.
Once these creditors agree to the plan, the rest are legally obliged to follow suit.
Once all of this has gone through, then management of your whole case, including any liaison with your creditors, is to be handled by your insolvency practitioner (IP).
During the course of your IVA, the creditors involved are forbidden from doing any of the following:
- Adding on any interest or late payment charges to the loans that are included in the IVA, or
- Harassing you for repayments on any of the loans involved, including sending you any letters or contacting you directly in any way.
If your creditors do continue to harass you, then you should get in touch with your IP immediately to let them know. They will then get in touch with the creditors in question on your behalf.
It is important to note though, that an IVA can only ever apply to certain, unsecured debts like personal loans or outstanding balances on credit cards. So any mortgages, for example, that are secured against your property, will not be included.
This means that your mortgage lenders will not be bound by the same restrictions as the creditors who are involved in the IVA.
Creditors who aren't involved in your IVA
Any creditors to whom you owe money that is not tied to the IVA are still entitled to contact you regarding any missed payments.
This is still the case if you owe a single creditor multiple debts, one of which forms part of an IVA, if the others don’t – they’ll still be allowed to contact you.
Unfortunately, you are still responsible for any communication with such lenders and if you are struggling to keep up with the payments in question then you should consider an additional form of debt management, or even bankruptcy.