What Happens at the End of an IVA? - Complete Guide, Tips, Advice, FAQs & More

Reaching the end of your IVA is no easy feat and if you’re at this point, you should definitely give yourself a congratulatory pat on the back.

That being said, you must keep in mind that you’re not out of the woods just yet.

There are definitely some things you should be aware of that can ensure you don’t run into any problems at the end of your IVA.

Running into hurdles or legal troubles at the very end of your IVA would be extremely upsetting so you must ensure that you’re educated about all the pitfalls so that your IVA completion goes smoothly.

Table of Contents

What is a Windfall and How can it Affect my IVA Completion?

A windfall is defined as a large sum of money that you may come upon over the course of your IVA. For example, this could be in the form of a lottery or money you may inherit from a deceased relative, etc.

Most creditors have a windfall clause in your IVA which states that if you obtain a windfall, you are legally obligated to hand 100% of it over to your creditors. This windfall sum will not count towards your agreed-upon IVA payments unless the sum is so large that it covers the entirety of your debt completely. Please keep in mind that hiding a windfall during your IVA is against the law and if you’re caught, this will not only lead to the termination of your IVA but to legal action as well.

There are certain cases in which you may be allowed to keep a portion of your windfall. For example, windfalls that are lower than £500 do not need to be handed over to your creditors. Another case is if you need a portion of the windfall for an emergency such as for your health or if handing over the windfall would be threatening the IVA itself. An example of this would be if you need the windfall to make repairs to your car that you need to commute to work. Please note that your IP will make your argument for why you absolutely need to keep your windfall. You must not spend any of your windfall amount without consulting your IP first.

Most people are definitely aware of windfalls and the legal obligation they have towards declaring their windfalls when their IVA is ongoing. What most people aren’t aware of, however, is the fact that you need to declare windfalls even after your IVA (technically) ends.

For more information on windfalls after IVA completion, you can click here.

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What Happens at the Annual Review of My IVA?

At the end of every year during which your IVA is in place, your financial circumstances will be reviewed by your Insolvency Practitioner (IP).

Depending on how you’re doing financially, your monthly IVA payments may remain the same, increase or decrease.

You don’t need to worry as you will never be obligated to pay more than you can afford. Your IP will ensure that.

For more information on how your annual review works, click here.

What Happens at the Final Review of My IVA?

Once you make your final IVA payment, your IP will conduct a final review of your finances and your IVA.

Larger IVA providers even have teams dedicated to final reviews known as closing teams.

For this review, you may be asked to produce payslips and other proofs of income. Using the documentation you provide, your income will be determined.

If your IP believes that your income has increased drastically, then you may be required to make more payments. If not, then your IVA will come to an end.

For more details on how the final review is conducted, you can click here.

What Will Happen at the End of my IVA?

We’ve already detailed some of the things that happen at the end of your IVA, i.e., you receive your IVA completion certificate and you have the option to make PPI claims if you wish.

Other than that, there are some things you should keep in mind both when you’re nearing your last IVA payment as well as once you’ve made it.

Usually, it’s completely clear which IVA payment is going to be your last but in some cases, it might not be that clear. For example, you may have some payments outstanding if you’d had a payment break or if extra months had been added into your IVA due to an income increase. Hence, it’s always a good idea to keep in touch with your insolvency practitioner so you know when your last IVA payment is and you can plan accordingly.

Once you’ve made your last payment, you will have one final review by your IP. In this review, they will ensure that you’ve paid the agreed-upon amount in full as well as review your financial situation to make sure you have indeed paid the maximum possible amount you could afford to give. Once they feel that everything is in order, they will notify your creditors of the completion of your IVA and start making arrangements for the production of your IVA completion certificate.

Conclusion

You’ve reached the end of a long road. The completion of your IVA is definitely a cause for celebration but you should definitely be careful not to make any moves that may land you in legal trouble.

Being aware of what you can and can’t do before you receive your IVA completion certificate is crucial in ensuring you’re able to close out your IVA smoothly.

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