Category Archives: Bankruptcy

Battling your debt, the IVA alternative to bankruptcy

If you’re battling with debt, you’ll unquestionably know how demanding dealing with creditors and working out a repayment plan can be. Actually, for those with unsustainable levels of debt, it can seem as though personal bankruptcy is the only solution. Before you consider personal bankruptcy, however, you need to consider all available options. An IVA is amongst the most attractive solution available. Despite the fact that personal bankruptcy can discharge some debt, in the end, it frequently has a devastating impact on a person’s credit history. An IVA – which is short for Individual Voluntary Arrangement – may help some people resolve their debt within a mere 60 months.

Battling your debt, the IVA alternative to bankruptcy

Woman Calculating Her Debt

Woman Calculating Her Debt

This does not only seem good, it truly is a realistic option from declaring personal bankruptcy. What exactly is an IVA? Simply put, an IVA is a legally binding contractual agreement between a person and debt holders. Typically, under this agreement, an individual might have as much as 70% of their debt wiped off. She or he can pay the rest of the amount within a 5 year period. The program can be modified to match an individual’s unique condition. 75% of creditors by debt value must approve the IVA proposal for the arrangement to be binding on all creditors. This might appear improbable – however, there’s a clear incentive to accept an IVA simply because they will probably receive more money than they’d get in case of a personal bankruptcy. For you as a consumer, an IVA offers an opportunity to discharge the debt contained in the IVA, and, as opposed to a personal bankruptcy, you’re very unlikely to lose your house. IVAs generally do remain on an individual’s credit history for six years, however, and are therefore still a serious matter.

Man Holding a Legal Document in Hand

Man Holding a Legal Document in Hand

To be eligible for a an IVA, you have to be a citizen of the United Kingdom, owe more than £15,000 and also have several creditors to your name. There are several professional debt management companies who offer advice and support regarding how to tailor an IVA to your needs. Please bear in mind that these companies are not funded by the government. If you want independent and confidential advice you should speak to the National Debtline. The service is free since the institution is funded by the government. However, you need to be aware that due to the increasing amounts of personal bankruptcies the governmental body may not be able to provide the service level and speed a private debt management company can.

You’re not alone: Help with Bankruptcy & Debt

Hands Holding Bankruptcy Law

Hands Holding Bankruptcy Law

So, if you’re facing bankruptcy, there’s no need to feel ashamed. By taking an active stance and addressing your debt issues, you may even be able to avert insolvency altogether.