How to get your Insolvency Practitioner to approve a car lease

This is worth reading, because almost nobody quotes it and it explains everything that follows.

The standard terms of the IVA Protocol, published by the Insolvency Service, say this:

During the arrangement, you must not obtain any credit greater than £500 without the prior written approval of your Supervisor, except for public utilities, insurance policies or other contractual payments as provided for in your income and expenditure.

Three things in that sentence matter.

"Prior written approval." Before, and in writing. A phone call where somebody says it will probably be fine is not approval, and it will not satisfy the company providing the car.

"Your Supervisor." That is your Insolvency Practitioner, wearing the hat they wear once the arrangement is running. Same person, formal title.

"As provided for in your income and expenditure." This is the part people miss entirely, and it is the route through. Payments already accounted for in your agreed income and expenditure sit outside the restriction. Which means the question to ask your IP is not only "will you allow this", but "can we get this into my income and expenditure".

You can read the full IVA Protocol standard terms on GOV.UK.

The deadlock goes like this, and it happens to almost everyone.

You ask your IP. They say find a company that will accept somebody in an IVA, get an offer, and bring it back. Reasonable, and they usually cannot suggest anyone, because it is not their job to know the market.

So you go to the leasing companies. They run a credit search, the IVA shows up, and they decline. Some will tell you they cannot proceed without your IP's consent. Others just say no.

Now you are back with your IP, who wants an offer you cannot get, from companies that want a consent you cannot get. Most people stop here, and the forums are full of them.

The way out is a company that will assess you and issue something in writing before the IVA becomes the reason not to.

1. 1Send your bank statements. Three months, plus your driving licence. No credit check happens at this stage, so nothing touches your file and your IVA is not an obstacle yet.
2. 2Get an answer on affordability. Someone reads the statements and works out whether the payment fits alongside your IVA contribution and everything else. You will hear back within two working days.
3. 3Pick a car. You need an actual vehicle and an actual monthly figure. This is the bit your IP cannot proceed without.
4. 4Get it in writing. You should have something showing the car, the monthly rental, the term and the amount due at the start.
5. 5Put it to your IP. In writing, with a short explanation of why the car is necessary. What to say is below.
6. 6Get their written approval back.
7. 7Then the application proceeds, including the credit check, which by that point is a formality rather than a hurdle.

Steps 1 to 4 cost you nothing and put nothing on your credit file. That is the point of doing them first.

Not whether you deserve a car. Three practical things.

Is it necessary? A car needed to get to work is a very different proposition from a car that would be nice to have. If your income funds your IVA, and the car is what enables that income, then the car is protecting your creditors' return rather than threatening it. That is the argument, and it is a strong one.

Does it fit? They will look at your income and expenditure and see whether the rental can be accommodated without reducing what your creditors receive. If the only way it works is by cutting your monthly contribution, expect a much harder conversation.

Is it proportionate? A modest car at £299 a month reads very differently from something expensive. Nothing on our list is extravagant, which helps.

Keep it short and factual. An IP deals with these regularly and does not need persuading, they need enough information to make a decision.

Include:

• The vehicle. Make, model, and that it is an ordinary car rather than anything unusual
• The monthly rental, the term, and the amount payable at the start
• Why you need it. Be specific. The journey, why public transport does not cover it, what happens to your income without it
• What it means for your contribution. Ideally that it changes nothing, and where the money comes from
• A request to update your income and expenditure to include the rental, so it falls within the exception in the standard terms

Ask for their approval in writing. You will need it.

If we can help, you will have the details you need in writing: the vehicle, the monthly rental, the term and the amount due at the start. That is what turns "I would like to lease a car" into something your Insolvency Practitioner can actually consider.

If your IP wants anything further, ask us. It is a normal request and we would rather answer it than have your application stall.

Our part is quick. You will hear from us within two working days of sending your statements.

Your IP's part is not in our hands and it is usually the longer half. Some come back within a few days, some take a couple of weeks, particularly if your case is being reviewed by somebody other than the person you normally speak to. Chase politely if you have not heard within a fortnight.

Start earlier than you think you need to. If your current car is failing or its agreement is ending, begin this two or three months out rather than two or three weeks.

It is not necessarily final, and it is worth asking why.

If the objection is the cost, ask whether a cheaper vehicle would be acceptable, and come back to us. The list changes and there is usually something less expensive.

If the objection is that it is not necessary, the answer is usually more detail rather than more argument. Set out the journey, the hours, and what actually happens to your earnings without a car.

If the objection is that your contribution would have to fall, they are almost certainly right, and the honest answer is that this is not the moment. That is a reason to come back later rather than push now.

And if you are nearly at the end of your arrangement, it may be worth waiting. Once your IVA completes, this becomes considerably simpler, although not on the day of your final payment. Your file will still show the arrangement as live until your completion certificate is issued and the credit reference agencies update, which takes a few weeks longer than most people expect.

Send us three months of bank statements and a copy of your driving licence. We will tell you within two working days whether this is likely to work, before any credit check and before you need to raise it with your Insolvency Practitioner at all.

If it is positive, you will have something specific to take to them, which is the thing you have been missing.

For the broader picture, see our main page on car leasing with an IVA.