Turning to IVA solutions has become a much more common method for people to rid themselves of their financial problems in recent years. However, signing up for one of these agreements is by no means a small undertaking so it is vitally important that you know as much as you possibly can about it before you make the decision. We have provided you with answers to some of the most common questions below.
How do I get started?
The first step that you need to take is to find a suitable insolvency practitioner to set up your arrangement. After you have made contact with them they will collect all the information from you that they need to assess your situation. When they have had chance to check everything over they will be able to produce a much more manageable monthly payment plan for you.
Does this involve getting a loan?
An Individual Voluntary Arrangement does not mean lending any more money from anyone. The way it works is by creating a plan that your creditors agree to so that your monthly costs are reduced to a lower amount.
Will I still have to pay interest or late payment fees?
In general, when you get set up on an IVA, you will not be subjected to any additional fees or charges on the amounts that you owe. It is always worth double-checking this with any arrangement to eliminate the chance of unexpected charges.
Will it take long to get set up?
When you initially contact a debt management company, they should be able to start work on your case straight away. Once they have got all of the details that they need they should be able to set up all of the agreements within the space of a few weeks.
Does this affect my credit?
You will more than likely end up with a much lower credit rating when you sign up for one of these arrangements. This again highlights the importance of doing your research and finding out as much as you can about all possibilities.
Will the proposed payment scheme be accepted?
The plan that is put forward by the insolvency practitioner does not have to be agreed by the creditors, they are perfectly within their rights to reject it. However, only 75% need to accept and you will find that most will as the plans are based on what you can afford.
Making the decision to go ahead with IVA solutions is a big step so before jumping in to any agreement you should make sure that you speak with a professional to understand all options.