What about Individual Voluntary Arrangements – IVAs

What about Individual Voluntary Arrangements IVAs

Money problems are an increasing cause for concern for a growing number of people in the UK. Recent figures reporting on the final quarter of 2009 show that over the last three months of the year nearly 36,000 people throughout England and Wales were declared insolvent. That's a quarter up on the same time the year before and contributed to a massive figure of nearly 135,000 for the year as a whole a record level well above the previous high set in 2006 at 107,288.

By far the largest rise in insolvency schemes (with a leap of more than 20% for the year) came in the form of Individual Voluntary Arrangements or an IVA. UK consumers seem to like what these alternatives offer, with many now preferring IVA help as opposed to bankruptcy. Scottish consumers have their own version of the IVA in the form of Scottish Trust Deeds.

What has made IVAs increase in popularity so much over the last few years? What is so attractive about an IVA?

The UK Government introduced IVAs in 1986 as legally binding agreements between creditors and debtors that freezes the debt. No more interest, no more adding to the money owed. If you have debt of more than 15k and are finding it impossible to pay it off then an IVA might be just what you need.

IVAs allow an agreed repayment plan to be established over a specified length of time (usually 60 months). They come with fewer restrictions and outstanding amounts are usually written off at the end of the repayment period. More flexible and less restrictive than bankruptcy, if you have a form of regular income and are able to budget monthly repayments with the agreement of creditors, then look closely at using an IVA as the best means by which you can get back on your financial feet again.

Don't delay. If you have financial concerns, a debt that is becoming increasingly difficult to manage or are finding that your income simply doesn't cover what's going out every month, act before things get completely out of hand. Talk to a debt management specialist about how IVA help can offer you the financial breathing space to get your debt under control.

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