Starting an IVA
People who find themselves in the situation that they cannot repay their debts, making the monthly payments had become a burden and they simply do not know how to live if they want to pay next month’s bills should consider an IVA. An individual voluntary arrangement is one of the best possible solutions to become debt free in a short period of time. Compared to other debt consolidation methods an IVA has many benefits. For example, compared to filing for bankruptcy, an IVA is a personal matter; nobody has to know about it. Also, based on the agreement you will repay your debts, so your credit score will not drop substantially after the IVA. Although an IVA might be a viable solution for most people who have debt issues, there are some conditions one must fulfill.
Starting an individual voluntary arrangement might be done in several different ways. One of the most convenient one is to call a helpline. One can find several companies which deal with IVAs, the internet or the yellow pages are the two most common places where people look for such help lines. Another way is to talk face to face with a financial adviser. Just like in the previous case, financial advisers advertise themselves on the internet, in the yellow pages, but one can find them by looking in newspapers too. Another method to look for a financial advisor is to call the National Debt Line or contact the Citizens Advice Bureau. These two latter sources will surely give you the names of trustworthy financial advisors, so if you do not want to take any risks, you should contact one of these agencies. The financial advisor will ask you several questions about your exact financial situation, and you should provide him every detail, because based on your answers he will be able to decide whether an IVA is the best solution for you or you can opt for something else to become debt free.
In case the financial advisor decides that an IVA is the best solution for your situation, he will recommend you an insolvency practitioner, who will deal with your case. You can look for an insolvency practitioner yourself, or you can choose the one recommended by the financial advisor. As soon as you contacted the insolvency practitioner, he will be the person who will deal with the situation; he will make all the arrangements needed during an IVA. Before you contact such a person, you might want to deal with the situation alone by contacting your creditors and trying to work out a solution. Creditors might agree to reduce the interest rate of your debt, or they can extend the period of repayment and this way your monthly payments will become smaller; they might even agree to repay only a certain percentage of the amount you owe and the rest will be written off. If you decide to talk to your creditors personally, you should prepare yourself by making a repayment plan. Most people cannot solve such a situation on their own, which is why they contact an insolvency practitioner who will do the job for them. He will help you come up with a repayment plan, contact your creditors and arrange a meeting between them, and finally he will be the link between you and your creditors during the whole process of the arrangement. Note that the document will become legally binding only after the creditors had accepted it! Also, be prepared that you might need to come up with several repayment plans, because creditors have the right do refuse your plan, they might ask for modifications, but the insolvency practitioner will help you come up with such a plan.
You should know a few things before you ask for professional help: there are a few debt types which cannot be included within an IVA. These are the following: secured debts or even a vehicle HP. Most of the unsecured debts can be included within an IVA: credit card debt, personal loans, student loans, store cards, overdrafts and so on. It is important to mention that in situations where the total amount of debts does not total more than £ 15.000, there might be other, better solutions than an IVA. It is good to know these facts, but your insolvency practitioner or financial advisor will explain you all the possibilities, and in case an IVA I not a suitable option for you, they will suggest other alternatives which will help you reach your goal: to become debt free! There is only one more thing you should know: an IVA helps you repay your debts in a relatively short period of time, the common duration of an IVA is five years, so you can become debt free pretty soon!
IVAs are the best solution for people who cannot repay their debts. There are only a few conditions to fulfill in order to be eligible: the total amount of debt should be more than £ 15.000 and the debts should be unsecured ones, because secured debts simply cannot be included within an IVA. If you fulfill all the conditions, the next step is to talk to an insolvency practitioner and the process will be started in no time.