Individual Voluntary Arrangement- IVAs Explained
An IVA is a way of getting out of debt that means that after paying your monthly payments for over 5 years (or 60 months), no matter what percentage of your debt it paid off, you will be debt free. Sound too good to be true? It's not. However it isn't as simple as it sounds to be accepted for an IVA. Here is a breakdown of what an individual voluntary arrangement is and its pros and cons.
Advantages:
· They are designed for those who are in a high amount of debt (over £15,000) or more and know that there is no realistic chance of them ever being able to pay it all off. Giving these people a lifeline
· The timeframe of paying off the debt is 60 months, which is reasonable
· Once the payment period is over, creditors cannot contact you to ask for more money, all charges will completely stop
· The payment is agreed and put into one that will be fair and more affordable
· You can retain control over your assets, as well as your home
· There is no social stigma attached as you won't be publically declared bankrupt
Disadvantages:
· If you can't pay your IVA then this is deemed a fail and you are back to square one. Which means you must consult a professional debt solution company such as Churchwood Finance before you take one out, to ensure this is the right method for you.
· There are some fees and costs involved, making it more expensive than bankruptcy.
· If your pay increases during the course of the IVA, this has to be taken into account
· It will be on your credit file for 6 years
· In some cases, you may be expected to release equity from your home if you are a home owner
The brief history of an IVA is that they were set up in 1986 by the government as an alternative to bankruptcy.
The amount you will pay monthly is assessed by a professional insolvency practitioner. If those who hold more than 75% agree to this figure, that is when the IVA will begin. For more information on IVAs call Churchwood for free on BT landlines on: 0800 2800 051
An IVA is a way of getting out of debt that means that after paying your monthly payments for over 5 years (or 60 months), no matter what percentage of your debt it paid off, you will be debt free. Sound too good to be true? It's not. However it isn't as simple as it sounds to be accepted for an IVA. Here is a breakdown of what an individual voluntary arrangement is and its pros and cons.
Advantages:
· They are designed for those who are in a high amount of debt (over £15,000) or more and know that there is no realistic chance of them ever being able to pay it all off. Giving these people a lifeline
· The timeframe of paying off the debt is 60 months, which is reasonable
· Once the payment period is over, creditors cannot contact you to ask for more money, all charges will completely stop
· The payment is agreed and put into one that will be fair and more affordable
· You can retain control over your assets, as well as your home
· There is no social stigma attached as you won't be publically declared bankrupt
Disadvantages:
· If you can't pay your IVA then this is deemed a fail and you are back to square one. Which means you must consult a professional debt solution company such as Churchwood Finance before you take one out, to ensure this is the right method for you.
· There are some fees and costs involved, making it more expensive than bankruptcy.
· If your pay increases during the course of the IVA, this has to be taken into account
· It will be on your credit file for 6 years
· In some cases, you may be expected to release equity from your home if you are a home owner
The brief history of an IVA is that they were set up in 1986 by the government as an alternative to bankruptcy.
The amount you will pay monthly is assessed by a professional insolvency practitioner. If those who hold more than 75% agree to this figure, that is when the IVA will begin. For more information on IVAs call Churchwood for free on BT landlines on: 0800 2800 051