A Personal Insolvency Agreement (PIA) is a legally binding arrangement with your creditors whereby you will commit to paying a certain amount in order to settle your unsecured debts. Your creditors then freeze your debts so that they will stop accruing interest and charges, and over the course of the agreement they will receive a percentage of the frozen debt.
In order for a PIA application to be accepted you need at least 75% of your creditors (in value) and 50% (in number) to vote in favour of it at a creditor meeting. Once it has been accepted the PIA becomes binding on all unsecured creditors, even those who may have voted against it. Whilst you are under the protection of an active PIA no unsecured creditor is able to try to have you made bankrupt.
For more information on Personal Insolvency Agreements and how ISA can help you to propose one, contact us today on 1800 003 883.