IVA Individual Voluntary Arrangement/ Debt Restructuring
Under section 20 of the Bankruptcy Ordinance, Chapter 6, Individual Voluntary Arrangement (IVA) is an alternative option for people facing bankruptcy. The debtor will appoint a proxy to propose a suggestion of the debt repayment to his creditors, which will be subject to a court hearing, a provisional order, and the approval from the creditors, to ensure that the debtor can properly settle the debt problems without reasonable burden. The appointment of an experienced proxy to deal with the debt restructuring arrangement is crucial to the success of the whole application. Previously, the IVA representatives were held by the Official Receiver of the Official Receiver’s Office. Since September 2002, those with qualifications and experience recognized by the court to be competent to deal with debt restructuring are certified public accountants.
All information of the clients will be handled by licensed lawyers/accountants with 100% confidence.
IVA is suitable for:
- Debt holders with stable income and owe debts of more than 10 times their monthly salary;
- Debt holders engage in sensitive occupations and are unable to file for bankruptcy.
IVA may restructure the following liabilities:
- Credit card outstanding loans | Private bank loans | Finance company loans | “Single amount clearance” High Interest loans | Credit Union loans | Student Aid loans | Tax | Business loans
Estimated time(from the date of application)
On Day 1
In about 2 months
In about 2 months
To pass the resolution by a majority of the creditors who are present to vote or their representatives (that is, accounting for more than 75% of the total value of the debt held by the creditors who are present to vote). The debt restructuring process will then be carried out; the monthly repayment will be made on time; and then the repayment will be arranged by the representative to the creditors.
The pressure of the debt is immediately reduced.
The court orders the settlement to save interest
Protect your living qualities without going bankrupt.
Benefits of debt restructuring
Frequent question of IVA
Generally speaking, it takes about three months from signing the documents, taking the oath and being scheduled to appear in court until the meeting with the creditors. The whole process will be followed up by our accountants and lawyers to protect your privacy.
Notification is not required for the vast majority of occupations, except for some employees of institutions regulated by the Monetary Authority or the disciplined services, such as banks/police. Family members will not be notified of a debt restructuring application.
Generally, the bank only requires the debtor to sell the property of positive equity to reduce the amount of debt. The majority of people with negative equity and owners in need of land premium will not have their properties affected.
Any employed persons can of course apply for debt restructuring. For self-employed persons, as long as they can provide reasonable proofs of income, they will also meet the basic requirements for debt restructuring.
Most creditors, on receipt of a notice for restructuring, are willing to pay concerns on the situation of the debtors and to defer payment until a meeting of creditors has been completed to negotiate a new repayment plan.
Under the Ordinance, a debt restructuring proposal by a debtor can only be formally approved with the consent of the creditors representing 75% or more of the total amount of debt owed.
The debtor should not borrow any more money during the IVA contribution period and usually, the loan application will not be accepted by the bank or financial institution.
Our methods of the charge of fees are simple, transparent and reasonable. Please refer to “IVA Debt Restructuring Fees “. In addition, our fees are to be collected by installments.
We guarantee no charge for unsuccessful cases. The fee agreement will not be signed until you decide to entrust us to act as your representative and decide that our accountant will draft the repayment plan on your behalf.
Please contact us if you encounter unemployment or salary reduction during the contribution period, because IVA contributions are made by a mutual agreement. However, if the debtors want to suspend or reduce their contribution, they must produce substantial documents and with the consent of the creditors.
IVA debt restructuring – consolidation of the debt, a reorganization plan subject to the processing through the court, generally suitable for a large amount of debt and a high proportion of debtors.
DRP Debt Relief Program – Negotiate new repayment plans with individual creditors, not subject to court proceedings. The costs are relatively low but not every creditor will accept a debt relief request.
IDRP Comprehensive Debt Relief Program – is a debt restructuring program that negotiates a new repayment method with the debtor’s largest creditor. In the whole process, as long as the largest creditor is willing to accept the debtor’s repayment plan, and that the other creditors have no objection, the largest creditor will consolidate all the debt of the debtor.
Occupation：Admin Tutor：$17,915 per month
Creditor Loan amount Current debt Minimum monthly repayment Interest rate Interest expense After IVA monthly repayment Period Interest rate after IVA Interest after IVA CITI $29,000 $30,362 $1,214 3.00% $911 $802 49 0.60% $182 HSBC $50,000 $50,496 $2,020 3.00% $1,515 $1,031 49 0.00% $0 JCB $10,000 $11,749 $470 3.00% $352 $310 49 0.60% $70 AE $47,000 $47,919 $1,917 3.00% $1,438 $1,361 49 0.80% $383 DBS $56,000 $57,838 $2,314 3.00% $1,735 $1,527 49 0.60% $347scroll right to read moreTotally money Saving: $5,951-$982 = $4,969Monthly repayment: $7,935 Reduced to $5,031
Occupation：Salon Tutor：$10,000 per month
Creditor Loan amount Current debt Minimum monthly repayment Interest rate Interest expense After IVA monthly repayment Period Interest rate after IVA Interest after IVA AE $33,000 $33,710 $1,348 3.00% $1,011 $1,112 40 0.80% $270 SCB $1,700,000 $157,011 $6,280 3.00% $4,710 $3,925 40 0.00% $4,710scroll right to read moreTotally money Saving: $5,721-$4,980 = $741Monthly repayment: $7,628 Reduced to $5,037
Occupation：CS Tutor：$16,600 per month
Creditor Loan amount Current debt Minimum monthly repayment Interest rate Interest expense After IVA monthly repayment Period Interest rate after IVA Interest after IVA HS Bank $52,000 $52,445.4 $1,700 4.00% $2,098 $1,093 48 0.00% $0 PROMISE $50,000 $50,900 $6,000 4.00% $2,036 $1,264 48 0.40% $204 EAST ASIA $139,384 $125,020 $4,465 1.12% $1,561 $3,229.68 48 0.50% $625 PUBILC $28,000 $32,700 $1,635 1.67% $468 $877.45 48 0.60% $196scroll right to read moreTotally money Saving: $6,163-$1,025 = $5,138Monthly repayment: $13,800 Reduced to $6,464.13
Occupation：Designer Tutor：$22,800 per month
Creditor Loan amount Current debt Minimum monthly repayment Interest rate Interest expense After IVA monthly repayment Period Interest rate after IVA Interest after IVA Aeon $30,000 $30,000 $1,200 3.00% $900 $748 67 1.00% $300 UA $5,000 $5,000 $200 3.00% $150 $125 67 1.00% $50 SC $20,000 $20,000 $800 3.00% $600 $299 67 0.00% $0 BOC $100,000 $100,000 $4,000 3.00% $3,000 $1,863 67 0.37% $370 HS Bank $70,000 $70,000 $2,800 3.00% $2,100 $1,045 67 0.00% $0 UA $30,000 $52,316 $2,378 3.76% $1,128 $1,303.99 67 1.00% $523 PROMISE $40,000 $54,600 $2,600 2.33% $933 $1,142.52 67 0.60% $606scroll right to read moreTotally money Saving: $8,811-$1,849 = $6,962Monthly repayment: $13,978 Reduced to $6,526.51
Occupation：Accounting Tutor：$42,000 per month
Creditor Loan amount Current debt Minimum monthly repayment Interest rate Interest expense After IVA monthly repayment Period Interest rate after IVA Interest after IVA SC $189,000 $161,677 $6,467 3.00% $4,850 $3,368 48 0.00% $0 DBS $37,000 $32,112 $1,284 3.00% $963 $963 48 0.50% $161 DBS $150,000 $67,496 $5,192 0.68% $1,025 $1,743.64 48 0.50% $337scroll right to read moreTotally money Saving: $6,838-$498 =$6,340Monthly repayment: $12,943 Reduced to $6,074.64