IVA Costs

What fees are involved?
When you speak to one of the advisers at Freeman Jones, they might recommend a specific debt solution as the best way of tackling your debts. Should you decide to enter a solution, fees will be charged - please see below.

What if I change my mind?
As a client of Freeman Jones, you would have the right to change your mind and cancel your agreement with us at any point. You will receive a full refund of your Initial fee if you do this in the first 14 days of accepting our terms of business. Please note that IVAs are legally binding and once signed do not have a "14 day cancellation" period.

Will it affect my credit rating?
It will. If you enter a debt management plan, your credit rating will be affected in the short term - and possibly in the medium to long term. If you enter an IVA, your credit rating will be affected for 6 years.

IVA Assessment fee
There is an assessment fee payable for the work involved in gathering and assessing the information that will go into your IVA proposal. You will receive a full refund of this fee if your IVA does not go ahead for any reason. This assessment fee is based on the information you provide to our advisers, and is equal to your monthly disposable income (after priority debts and living costs), subject to a minimum of £295 and a maximum of £495. Please note: the IVA assessment fee will not be passed on to your creditors or go towards the actual IVA itself.

IVA fees breakdown
The fees you pay into your IVA fall into two categories: a Nominee's fee and Supervisor's fees. The following example shows the fees and payments involved in a typical client's IVA:

Breakdown of typical payments and fees on an IVA:

  • Nominee's fee: £1400
  • Supervisor's fee: £2000
  • Supervisor's costs: £400
  • Typical monthly repayments (x60 months): £220
  • Total paid by borrower (including fees mentioned above): £13,200
  • Total unsecured debt written off on completion: £17,600

Example based on a typical client - with unsecured debts of around £31,000, who has no equity in any property and completes a 5-year IVA. Fees shown are inclusive of VAT where applicable. For a more detailed breakdown, speak to our experts on 0800 970 7725.

Nominee's fee
This is a fixed fee. It covers the work involved in setting up your IVA. This includes:
  • Drafting your IVA proposal - which tells your creditors how you and your IP believe the IVA should work.
  • Arranging the creditors meeting - at which your creditors will approve your proposal, reject it, or ask for changes to be made to it.
  • Advising you after the meeting - helping you decide between accepting the suggested changes to the terms (if any) and opting for a different approach to your debts altogether.

For the first few months (as detailed in the IVA proposal), the payments you make into your IVA will go towards the Nominee's fee - not to your creditors.

Supervisor's fees
Once your IVA is up and running, it will require ongoing supervision and maintenance all the way through (i.e. for 5 years, with most IVAs). So, once the Nominee's fee has been paid, a percentage of each monthly payment will be taken as a Supervisor's fee (as detailed in the IVA proposal). This will cover the work done by:
  • Your Relationship Manager - who will ensure your IVA runs smoothly, handling any day-to-day issues which arise. They'll also provide any help and advice you require.
  • Your IP - who will review your IVA on a regular basis. They'll also address any major issues that arise: if your financial circumstances get worse, for example, your IP may arrange an IVA variation (a legally binding change to the terms of your IVA, designed to help you bring your IVA to a successful close).

Please note: Your payments to your IVA must be maintained or your IVA may fail, in which case you would be liable for the remaining balance and any costs already incurred. However, IVAs do offer some flexibility - if you run into any unexpected costs while your IVA is in progress, your creditors may let you miss a few payments if they can see this will prevent the IVA from failing.