Individual Voluntary Arrangement ( IVA) – Completion certificate
What is an IVA completion certificate?
An individual voluntary arrangement (IVA) is a legally binding agreement between you and your creditors that helps you pay off your debts at an affordable rate. You make payments managed by an insolvency practitioner.
There is some detailed information on our website about IVAs.
The Completion Certificate
When an individual has met all their obligations under the IVA, the IVA will have successfully concluded.
At this point the supervisor ( an Insolvency Practitioner ) will prepare an IVA completion certificate which will be provided to the individual and their creditors.
The completion certificate is the individual’s evidence that they have complied with all the terms of their arrangement and that it has been successfully concluded.
What is the effect of an IVA completion certificate?
The IVA completion certificate is an important document and should be retained by the individual. This is because:
- It will mitigate any future claims against them arising from creditors bound within the IVA, should they pursue the individual following the completion of the IVA.
- It grants peace of mind to the individual that the IVA has been a success.
- It may assist the individual in obtaining future finance, such as a property mortgage, as it will confirm to the bank that the IVA has been discharged, although this will be dependent on the requirements of the lending bank.
Whilst the terms of each IVA will vary, it is important to note that often the completion certificate will not affect the duties and powers granted to the supervisor under the arrangement. Mainly this is to enable the supervisor to remain empowered to make final dividend payments should, for example, a creditor be slow to bank a dividend cheque.
This can also serve to ensure that any assets which were caught under the IVA trust remain within the trust. An example of such an asset is Payment Protection Insurance (PPI) claims. Whilst it is no longer possible to initiate PPI claims, for many years individuals discovered they were entitled to a PPI refund from a period in which they were subject to an IVA.
How such claims are dealt with should be clearly stated within the IVA proposal at its inception and should be discussed with the Insolvency Practitioner. The individual will be required to sign confirmation of their understanding of the terms of the IVA by the Insolvency Practitioner as part of their engagement process.
It is therefore important to ensure that any such claims are communicated clearly to the former supervisor, as the former supervisor will ensure that these funds are dealt with correctly in accordance with the terms of the IVA.
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