An IVA acts as an alternative to bankruptcy and can help you deal with UK debt whilst you are living in the USA, so long as it is less than 3 years since you were last resident in the UK.
An IVA is designed to help anyone who has UK debt of more than £10,000 reach a new agreement with their creditors, allowing them to only repay what they can afford.
It has a fixed repayment term, usually set to 5 years, after which any unpaid debt is legally and completely written-off.
Payments into the IVA are preset to what is deemed as being affordable after the applicant's living expenses have been taken into account.
An IVA must be administered and supervised by a licensed Insolvency Practitioner who acts as a mediator between the IVA applicant and their creditors.
One of the significant advantages for an IVA over other debt solutions is that it protects the applicant's real estate from the actions of their creditors.
In most cases, the applicant's US real estate will out of reach to their creditors, meaning that their real estate is beyond the jurisdiction the official receiver should the creditor try and take bankruptcy action in the UK.
But where this isn't the case, or in cases where there is a property in the UK the IVA will offer protection.
By agreeing to the terms of the IVA, creditors must forfeit their right to take legal action against the applicant and, without the ability to take legal action, creditors lose the chance to 'force a sale' of the applicants assets.
This includes all the applicant's real estate or property whether in the UK or USA.
In some IVA cases the creditors hope to benefit from a release of equity from the real estate as part of the IVA. This is detailed in a special clause of the IVA called the equity clause.
Under the clause, the applicant is compelled to try to release equity from the real estate through refinancing it, but if the real estate can't be refinanced, the creditors instead benefits from a 12 month extension to the IVAs payments.
Once the applicant's financial needs have been assessed and a monthly payment has been set by the creditors, payments to the Insolvency Practitioner must be set up.
There are 3 practical considerations to be noted when setting up an IVA whilst living in the USA:
Payments will need to arrive into a UK bank account in UK Sterling, so arrangements must be made to exchange US Dollars for UK pounds and for the transfer to take place each month.
All costs for money transfer and money exchange will be down to the applicant, so these costs will need to be taken into account as part of the overall financial needs.
Finally, the Insolvency Practitioner acting as the supervisor will disperse the funds directly to creditors as part of his duties to the IVA.
If you live in the USA and the thought of applying for an IVA appeals to you, then simply complete our IVA application form today.
One of our dedicated team will respond as soon as possible to your request for help to begin the IVA process.
Unfortunately, running away from a serious debt problem doesn't actually solve it.
Even if you are prepared to run a very long way, such as to the USA.
In today's global village, it is becoming more and more difficult to become untraceable and, when there is a financial incentive to find you, there is always the chance someone will trace you to your new home.
So, if you have moved to the USA from England, Wales or Northern Ireland and subsequently left behind unpaid personal debts, perhaps the information on this page will help you take back control of your situation.
Setting up a home in the USA takes a great deal of courage and can be extremely time consuming and energy sapping and it's all too easy to lose track of your finances.
Leaving a debt unpaid for a month or two could simply be an oversight, made easier when the creditor doesn't have your new contact details in the USA.
And, whilst most people would never set out to deliberately mislead their bank or to disappear from their radar, it can become a very convenient side effect of moving away.
Without your new USA address, your creditors will be at a loss to know how to contact you, and in your absence the chances are your debt will simply grow and grow.
So, the trick is to deal with the debt before it spirals out of control and becomes unmanageable.
There are a few different ways in which you can deal with your UK debt when you are living in the USA.
There are typically 4 options you have for dealing with debts over £10,000
This article has focused specifically on the IVA solution, but follow these links for information on the alternatives: