An IVA Could Be The Solution For You

Posted by UK IVA Help in IVA Advice on Jan 2nd, 2010 | no responses

Over the past year the financial sector has been thrown into chaos as a result of the global credit crunch and this has resulted in an increasing number of people deciding to opt for solutions such as an IVA to get them out of debt.

Although the IVA – or Individual Voluntary Arrangement – is not for everyone, it can provide some people with an effective and efficient solution to their debt management problems.

Over the past couple of years companies that deal with IVAs have been engaging in more advertising, and this has resulted in increased awareness about this debt solution amongst consumers and subsequently in increased interest in this solution.

An IVA or individual Voluntary Arrangement is a solution that could help many people in debt, and many of these borrowers may be able to escape the harshness of bankruptcy by opting for an IVA instead. The IVA has become known as a softer alternative to bankruptcy, and gives those in deep debt the chance to get out of debt far more quickly.

There are specialist firms that deal with IVAs and debt charities can also offer more information on this process if you are interested in opting for the IVA route. However, you will only be eligible for an IVA if you meet the set criteria required for this process. Part of the requirements to qualify for an IVA include having unsecured debts of at least £15,000 with a range of creditors, and also being in full time employment.

You should not assume that an IVA is an easy way to escape your debt, as it is a long winded process, can have a profound impact on your financial future and is a legally binding process. You should also consider the benefits of entering into an IVA when making your decision. Some of the benefits that come with an IVA is being able to get rid of all of your unsecured debt in as little as five years, having much of the debt written off where appropriate, and being able to make just one, affordable repayment towards all of your unsecured debts each month, which can easy your financial situation.

With an IVA, your single monthly repayment is distributed between the various creditors on a pro rata basis, based on the amount that you owe to each lender, and these repayments usually continue for a period of five years. At the end of the five year term any outstanding balance is usually written off, and you can enjoy being debt free. However, you must ensure that you stick to the terms of the IVA and keep up with repayments over the five year term.

There are various other debt solutions that you can opt for if you do not want to go for an IVA, and this includes debt management plans, consolidation, or informal arrangements with your creditors.

Alisdair Cosgrove is an expert in the field of personal finance in the UK and has been writing articles on the web for many years. You can find more of his information at the UK site Glitec.co.uk, offering online loans and great deals on IVAs. Visit Glitec.co.uk today for a great mortgage and loan offer and to read more articles from Alisdair.