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Whatever your circumstances, our aim is to offer advice that is in your best interests to enable you to look forward to a debt free future.
An IVA is often an attractive option for creditors as it is a better option for them than if you were to go bankrupt. An IVA is suitable if you do not want to file for a full bankruptcy due to the stigma associated with bankruptcy or the major effect on your credit file.
However before considering an IVA there is minimum criteria that you must meet to qualify for the IVA. We recommended that a debtor speaks to a qualified Debt Plan advisor to get a better understanding of what these are. The following are some simple guidelines for what are the minimum criteria for an IVA:
- Unsecured debts of at least £15,000 - £20,000 (No maximum)
- Ability to make monthly payments of £250-£300 (No maximum)
- A stable monthly income.
Advantages of an IVA:
- Monthly payment is affordable
- Avoid bankruptcy
- Keep house and car
- Interest payments frozen by law
- Legal action stopped by law
- Reduce debt by up to 75%
- Debts cleared in five years
- IVA proposal is controlled by the individual
Disadvantages of an IVA:
- No more borrowing allowed during the IVA period
- Impact on credit rating can make it difficult to borrow for a further year after the IVA
- Default on an IVA could result in bankruptcy proceedings
- 5 year period of an IVA against a maximum 3 year period of bankruptcy
- Declare all assets of any value (house, car etc) and possibly release any equity to pay towards the debts
- Any windfall, inheritance or bonuses must be declared
Be Careful
There are numerous companies who are try to be push IVAs as the best debt solution for your circumstances. You must be wary of any advertising that offers the chance to ‘Write Off Up To 75%-90% of Your Debt’ before even knowing the individual’s circumstances.
If you are considering an IVA make sure you fully understand the difference between bankruptcy and an IVA. Be careful not to continue to build up other types of debt such as credit cards and overdrafts.
How to Apply for an IVA
Debt Plan Direct has a high volume insolvency department that processes hundreds of applications every month. There is also a selected panel of preferred partners who can handle IVAs for various specific circumstances. If you are not satisfied with the progress of an existing IVA application with another organisation contact Debt Plan Direct to see if an alternative can be arranged.
To talk to an advisor about an Individual Voluntary Arrangement call 0845 055 8152 or complete the enquiry form.
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