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For those who go through the challenges of an IVA, the receipt of an IVA completion certificate means you can start to rebuild, look forward and leave the past behind. The ability to enjoy life again should not be underestimated but it is essential that you chase up any delays in the production of your IVA completion certificate.
What is an IVA completion certificate?
The best way to describe an IVA completion certificate is a signing off process by the insolvency practitioner appointed to manage your arrangement. It confirms that you have successfully completed the process, made all of your legally obligated payments and you will no longer be bound by the terms and conditions of the IVA. You are free!
While this is officially referred to as an IVA completion certificate it is actually confirmation on the insolvency practitioner’s letterhead discharging you of all of your IVA related obligations. Not a physical certificate.
Why is an IVA completion certificate so important?
Aside from the fact that an IVA completion certificate discharges you from all of your legal obligations, there are two major actions which will follow:-
- You will be removed from the insolvency register
- You can start to rebuild your credit rating
Rebuilding your credit rating and effectively your life will take time, probably involve relatively small steps but it is a process you may wish to begin as soon as the completion certificate has been issued. It is very important to start and rebuild your credit rating as the IVA reference will be removed six years after it began. So, if the IVA lasted five years then it will still be on your credit file for a further 12 months.
When should you receive your IVA completion certificate?
There is a common assumption that the completion certificate will be issued immediately after you have made your final legally obligated payment. In reality, this is not the case and there are a number of reasons why the issue of the certificate can be delayed.
The insolvency practitioner needs to review your case
Upon making your final IVA payment the insolvency practitioner will then review your case to ensure all terms and conditions have been met. At this point it is normal for the insolvency practitioner to request recent wage slips, bank statements and any other relevant documentation regarding your income and assets.
Outstanding disputes
It is not uncommon for insolvency practitioners to hold off issuing an IVA completion certificate until all outstanding disputes have been settled. The most common issue of late has been the possibility that an individual could receive compensation for the mis-selling of PPIs. The likelihood is that any compensation received would be distributed amongst your creditors.
Assuming everything is in order you should receive your IVA completion certificate within 6 to 8 weeks of your final payment although this timescale can vary between different insolvency practitioners.
Signing over outstanding claims
The vast majority of people who have undergone an IVA will be relieved to make their final payment, allowing them to look to the future. However, if for example there was a delay in issuing an IVA completion certificate due to an outstanding PPI claim there may be options to mitigate this.
Some insolvency practitioners may allow you to effectively sign over the proceeds of any future compensation to be distributed amongst your creditors. The reasoning behind this is simple, at the time of your IVA, the claim was outstanding and therefore in the eyes of the law any proceeds should be shared amongst your creditors. This action should fulfil the obligations of the insolvency practitioner and allow them to produce your IVA completion certificate.
There have been instances where delays in receiving an IVA completion certificate have overlapped with inheritance windfalls. While unlikely, legally the insolvency practitioner managing your IVA could claim part or all of these funds to enhance creditor payments. However, this could open up insolvency practitioners to counterclaims if the delay in producing the completion certificate was deemed to be excessive.
What can you do if your IVA completion certificate is delayed?
The general consensus seems to be that if you have not received your IVA completion certificate during the eight week period after making your final payment then you should make enquiries. There may be a perfectly valid reason why your certificate has been delayed but it is the obligation of the insolvency practitioner to make you aware of any problems. A prolonged delay not only means your name remains on the insolvency register but you can’t start to rebuild your credit rating.
Many people seem concerned that making a formal complaint about a delay in receiving an IVA completion certificate could have repercussions. This is not the case. In recent times there has been an increase in complaints regarding this matter and regulators are taking it very seriously. They appreciate that the individuals involved are coming towards the end of what can be challenging times and are keen to get their lives back on track, putting the past behind them.
If you feel that your complaint has not been addressed properly, or the reasons given do not appear reasonable, you are quite within your rights to take your complaint directly to the industry regulator.
What to do when in receipt of your IVA completion certificate
When in receipt of your IVA completion certificate you can breathe again and at least look at planning ahead. The IVA reference will remain on your credit file for six years after the arrangement first began. It could be useful to monitor your credit files accordingly to ensure reference to the IVA is removed as soon as possible. In reality, this should be an automatic procedure as should the removal of your name from the insolvency register.
It is advisable to retain a copy of your IVA completion certificate on file in the event that there are issues or claims made further down the line.