When to use an IVA
Reputable debt management companies receive up to 100 telephone calls per day from people who have been given poor IVA advice.
An IVA (Individual Voluntary Arrangement) is an ideal way to reach an amicable arrangement with creditors. This way the debt can be repaid in manageable monthly sums over a period of around five years.
Over the past two years, applications for an IVA have doubled. People choose this option to avoid the stigma associated with bankruptcy. It also allows them to hold on to their assets.
However, it is worth bearing in mind that an IVA may not be the ideal solution for everyone as they do incur fees. Many people are overcharged for an IVA and bogus firms are charging customers large upfront fees for an inferior service. Hence the reason why IVA advice should be sought from reputable debt management companies.
A reputable debt advisor will ensure that he has satisfied set criteria before an IVA is recommended. One of these stipulations is that a debtor must have a minimum of £200 cash per month to survive on and he/she must owe money to at least three individual creditors.
An example of bad IVA advice can be found when a debtor is told that an IVA will not show up on credit records when in fact, it will. However, an IVA can be set up in as little as six weeks and all of your creditors will be taken off of your hands. You simply pay an agreed, affordable monthly payment to your Insolvency Practitioner, which will include a percentage for his fees.
Debt counselling must be carried out in compliance with licensing and regulation laws by experienced professionals. Before agreeing to an IVA, seek professional debt advice from a reputable source to ensure you choose a company who is operating legally and with your best interests at heart.
