The role of the IVA Nominee.
For those people considering proposing an IVA, there's a chance they'll hear of the 'IVA Nominee' whilst doing their research.
So, here's a brief explanation of what an IVA Nominee's role is within the IVA process.
Who Is The IVA Nominee?
The 'IVA Nominee' is the name given to the role played by the Insolvency Practitioner in the period leading up to the Creditors' Meeting.
The Insolvency Practitioner becomes the Nominee when they receive an official letter of engagement from the IVA applicant, which is normally one of the first things the applicant is required to provide.
The role of the Nominee is potentially a short lived role, so long as the IVA is accepted, because once the IVA has been accepted by creditors, the Insolvency Practitioner changes roles again to that of IVA supervisor.
During the time before the Creditors' Meeting the Nominee acts on behalf of the applicant to prepare their IVA proposal.
Here are a few of the duties undertaken by the Nominee:
Appointing the NomineeThe Nominee is appointed when an applicant returns a notice of 'Instruction To Act', stating they wish to nominate the Insolvency Practitioner to act on their behalf by applying for an IVA.
Oversee the preparation of the proposalThe Nominee ensures the IVA proposal represents an open and transparent account of the applicant's financial situation. The Nominee is tasked with ensuring the information within the proposal has been verified and is correct.
Assessment of assetsThe Nominee ensures the applicant is made aware of the obligations placed upon them by entering into an IVA, particularly those relating to any assets for inclusion in the IVA, for example, understanding how equity in a property will be dealt with, or the need to surrender endowment policies or savings.
Verify the IVA budgetThe Nominee will verify the applicant's income and expenditure and confirm the proposed budget demonstrates an affordable IVA payment which is fair to all parties.
Stop preferential treatmentThe Nominee will provide advice on how to handled creditor payment obligation in the period before the IVA Creditors' Meeting. The Nominee will advise that no preference is to be shown to any one creditor, which could prejudice the IVA.
Correspond with creditorsThe Nominee will deal with the creditor correspondence. This can involve dealing with collection agencies and Court proceedings. The Nominee will consider whether entering the IVA applicant into Breathing Space is required to stay any legal proceedings that may impact on the IVA.
Bankruptcy comparisonThe Nominee will provide a comparison statement to creditors, displaying the likely financial return in the event of the IVA applicant's bankruptcy to demonstrate a comparison as laid out in the IVA proposal.
Projected dividendThe Nominee will provide an estimate of the funds to be distributed to the creditors on the approval of the IVA.
The principle of having a Nominee works well within the IVA process.
Because the Insolvency Practitioner oversees the preparation of the IVA, creditors can have confidence in the process.
The Nominee role brings a level of authority to the IVA process that provides peace of mind to both sides.
If you're considering entering an IVA and would like to have a chat with an IVA specialist, simply call 0800 856 8569.
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