IVA fees

There are two types of fees within an IVA: a Nominee's fee and a Supervisor's fee. The Nominee and Supervisor is a professionally qualified and licensed Insolvency Practitioner (IP).

Nominee's fee

Before an IVA is presented to creditors, the IP acts as your Nominee and is required to endorse your IVA proposal and provide a report to advise whether in their opinion, it has a realistic chance of success.

The Nominee's fee covers this initial work, including;

• Drafting the IVA proposal
• Collecting creditor claims
• Giving notice of and holding a meeting of creditors

Supervisor's feese

As soon as your IVA is accepted the IP's role changes and they become your Supervisor. In addition to providing support to you, the IP will supervise and maintain your IVA throughout its term (usually 5 years).

The Supervisor's fee covers this ongoing work, including;

• Completing annual reviews of your IVA
• Providing reports to creditors
• Distributing dividend payments to creditors
• Addressing any major issues that arise: if your financial circumstances change, for example as a result of maternity leave, your IP may arrange an IVA variation (a legally binding change to the terms of your IVA, designed to help you bring your IVA to a successful close).

Payment of Fees

All IVA providers charge fees in line with an agreed scale set by creditors. Fees are taken as part of the single monthly payment you make towards your IVA; there is no additional cost and unlike some companies there is no upfront fee.

Fees depend on the amount you owe and how much can be repaid during the IVA. Your IVA proposal will detail the exact amount of fees being charged by the IP.

The following example shows typical fees and payments in an IVA:

Breakdown of typical payments and fees on an IVA*:

Nominees Fee	£1,275
Supervisors Fee (over 60 months)	£2,475
Expenses	£290
VAT	£656
Typical Monthly Payment	£300
Total Paid by Individual	£18,000
Amount owing at the beginning of the IVA	£31,000
Net paid to creditors	£13,304 (43%)
Amount written off at the end of the IVA	£17,696 (57%)

*Example based on a typical client - with unsecured debts of around £31,000, who has no equity in any property and completes a 5-year IVA.

Please note: Your payments to your IVA must be maintained or your IVA may fail, in which case you would be liable for the remaining balance and any costs already incurred.

IVAs do offer some flexibility. If you run into any unexpected difficulty while your IVA is in progress, you should contact your Supervisor immediately. The IP can request changes to payment plans and call further creditor's meetings to seek approval of variations to the proposal if needed.