Put simply, an Individual Voluntary Arrangement or IVA is a form of debt management that allows you to restructure all of your debts in to one affordable monthly payment by creating a new agreement between you and your creditors and spread the costs over 60 months. Once your IVA has been agreed it cannot be amended by your creditors and any debts outstanding after the term of your IVA will be written off so you will once again be debt free.
An IVA is available to anyone living in England, Ireland or Wales and is a legally binding agreement. You must have unsecured debts over £10,000 between at least two different creditors and be able to pay a minimum of £150 per month and you must be able to prove that you are insolvent.
If you believe you meet the criteria an IVA may be the perfect option to get you out of debt. Let’s look in to IVA’s a little deeper.
How can an Individual Voluntary Arrangement help you?
Easier monthly payments–
If you have high value debts that you’re struggling to pay the chances are your revised monthly repayments will be considerably less than what you’re paying at the moment, making it a far less stressful option.
Wipe out a proportion of your debts–
Any outstanding debt is forgiven after five years so you could end up repaying only 30% – 80% of your total debt. This is just a guide and will depend on your personal circumstances and level of debt.
Preventing Bankruptcy–
An IVA is a good alternative to bankruptcy. You won’t lose your assets such as your home as long as you are maintaining your monthly payments. This is a legally binding agreement so your creditors must also uphold their end of the agreement.
No more harassment–
Part of your IVA agreement states that your creditors are not allowed to contact you as long as you are keeping within the guidelines of your IVA. This means no more nasty phone calls and threatening letters providing you with a peaceful life.
No more debt–
Once your Individual Voluntary Arrangement (IVA) is complete you will be completely debt free and you will be happy in the knowledge that you did your absolute best to pay off as much of your debts as you could.
Before you take on any type of debt management solution you should seek the advice of a debt management company. They will take your personal circumstances in to account and look at the whole picture when figuring out the best type of debt management solution is right for you. Harrington Brooks have over 12 years experience in the debt management industry and are certified member of DEMSA, the governing body behind debt management companies. They are currently looking after over 35,000 UK residents to manage their debts and help them to become debt free.
Martin Bradley is a representative of Harrington Brooks who provide IVA, Individual Voluntary Arrangements and Debt Management Plans to individuals struggling with debt. For more information please read more here .