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This solution is available in England, Wales and Northern Ireland. 

How does a meeting of creditors work?

Before your individual voluntary arrangement (IVA) is activated, there’ll be a meeting of creditors (sometimes known as a MOC). This is when your creditors review the IVA proposal we put together with you. After reading the proposal, your creditors will vote on whether or not your IVA can go ahead. 

The term ‘meeting’ can be quite misleading. Creditors are very rarely in the same room when voting on your IVA. We often refer to it as a 'virtual meeting’ because creditors can attend the meeting by telephone conference but usually they put their votes on voting forms.

The date of the meeting of creditors is really just a deadline for all votes to be submitted. You don’t need to attend meeting unless you want to but you just need to be available by telephone on the day so the outcome can be confirmed.

What happens before the meeting of creditors?

Before the meeting of creditors takes place, you’ll need to put together your IVA proposal. This is a document that sets out the terms of what you’re offering your creditors through your IVA. We’ll help you put this together and send you a copy for review.

After you’ve read through the proposal, one of our Insolvency Practitioners (your Nominee) will arrange a time to talk to you over the phone. They’ll go through the proposal with you to make sure an IVA really is the best solution for your debts.

Once both you and your Nominee are satisfied with the proposal, your creditors will review and vote on it. Anyone you owe money to will be sent a copy of your proposal, and creditors get up to 28 days’ notice of the meeting.  We’ll also send you a letter telling you when the meeting will take place.

What happens during the meeting of creditors?

Once the creditors have been given notice of the meeting, the voting will start. Each set of votes will be reviewed. You’ll also get a letter confirming the date and time of the meeting.In order for your IVA to be approved, more than 75% of the value of the creditors that vote must agree to it.

Sometimes creditors may ask that changes are made to the proposal. These are called modifications. A typical example of a modification request would be an increase in the monthly payments being offered or an extension to the length of your IVA. 

If your creditors request a modification, we’ll let you know as soon as we can. It’s important that you have time to think about what they’re asking for and how it may affect your budget. The meeting or deadline can be postponed to give you extra time if you need it.

It’s important that we’re able to get in touch with you during the voting process to discuss any modifications requests. We’d also need to let you know the outcome of the voting and talk you through the next steps. Your IVA can’t start until we’ve spoken to you.

What happens after the meeting of creditors?

Once the votes are all in, we’ll give you a call to let you know the outcome of the meeting.

If your IVA has been approved, we’ll talk you through what happens next. Things will normally proceed as follows:

  1. You’ll get a welcome pack through the post a few days after the meeting of creditors. The pack will confirm that your IVA has been approved.
  2. You’ll now be looked after by our supervisory team. They’ll be on hand for any issues you may have during your IVA. They’ll also conduct your annual IVA review. Please get in touch with them if you ever struggle with your monthly IVA payments or if there are any changes in your circumstances.
  3. Throughout your IVA, the Insolvency Practitioner will watch over things and make sure the terms of your IVA proposal are followed.

A typical IVA will last 5-6 years. After this time, as long as you’ve stuck to the terms of the agreement, your remaining debts will be written off.

Circumstances can sometimes change during the course of your IVA, at which point you may need to have what’s called a ‘variation meeting’. This is when your proposal would be reviewed and resubmitted to your creditors to cast their votes. If you need to have a variation applied to your IVA, we will keep you updated on the outcome.

What happens if my IVA isn’t approved?

If your IVA isn’t approved, we’ll get in touch with you to let you know and answer any questions you may have. We’ll refer you back to the charity debt advisors who’ll take another look at any other options available to you.

Depending on your circumstances, it may be possible for us to ask the creditors to vary the terms of your original proposal. If it’s a big change, we may need to invite the creditors to a variation meeting so they can re-cast their votes.

Want to know more about your IVA? 

There are lots of great articles on our website that can help you get the best out of your IVA. They include:

Helping you become debt free...

“I wish to thank your staff for all the great help they gave me when I was in so much debt.
They were a pillar of support to me.” (Leslie, Essex)

Foundation for Credit Counselling Wade House, Merrion Centre, Leeds, LS2 8NG trading as StepChange Debt Charity and StepChange Debt Charity Scotland. A registered charity no.1016630 and SC046263. It is a limited company registered in England and Wales (company no:2757055). Authorised and regulated by the Financial Conduct Authority.

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