Best Advice on use of Individual Voluntary Arrangement UK

Nowadays, numerous UK residents have become overwhelmed by debt every year and the thing which is considered as the major contributing factor in this is the use of credit cards and other alike forms of credit. Regrettably, nowadays we all are living our lives on credit because it is deliberated as one of the most basic standards of living. It is because it allows us to spend more than the amount that we have at our immediate disposal. In most cases, when it comes to payback that credit it comes too much that the size of debt deteriorates too far.If you are able to catch the situation well before when it is about to reach at a critical level, a proper debt management plan can be of great use, in this case, to get you back into the light.

There are many people who are not able to catch up to the situation well before it reaches at a critical point where it is impossible for them to repay the debts out of their available income in a given time. Before you lose hope and make the decision of filing bankruptcy, you should without any doubt go for an individual voluntary arrangement (IVA). This is because it has the capability to write off a massive part of your debt and simply pay a percentage of it.

Individual Voluntary Arrangement UK

Voluntary Arrangement UK

It is demarcated as a lawful arrangement between you and your creditors. Here in this arrangement, you come to an agreement to pay your creditors a percentage of the total you owe them by making consistent expenses that is based on the total amount you are capable enough to afford. In this, you usually will have to make regular payments for a duration of five years and after that the remaining amount of your debt is written off and you are once again debt free. This agreement can only be set up by a licensed professional. It means you will need to get in touch with a professional UK debt management company who will help you set up a voluntary arrangement. An indebtedness expert will be appointed for your help in this process.

He will ask you questions related to your financial situations. It is necessary for you to give him the accurate information related to financials as it will, later on, will used to apply for an Interim Order. He will also arrange a meeting with the creditors in which they will vote in the benefit of the arrangement. The creditors representing the seventy five percent of the monetary value of debts will have to agree on the IVA (individual voluntary arrangement) for it be authorized. After getting that agreement, the creditors who didn’t agree on the arrangement are also bound by it. Since it is a legal agreement between you and your creditors, you or the creditors will need to stick to it without changing minds.

Who is Eligible to Apply for an Individual Voluntary Arrangement?

Apply for an Individual Voluntary Arrangement

IVA (individual voluntary arrangement) is certainly not recommended for everyone. It is because some people can also take help from debt management plan only when if they are not in deep debt. Moreover, this legal agreement is only available for the UK residents. You can apply for this arrangement only if:

  • You have a stable earnings but have become overwhelmed with debt
  • You cannot risk to lose your property like in most bankruptcy cases you will
  • You don’t agree on losing your employment position which you might lose by filing for bankruptcy
  • The debt amount you owe to your creditors must be more than fifteen thousand pounds

An IVA doesn’t have any kind of negative impact on your credit as compared to bankruptcy. It certainly might not be as harsh as bankruptcy but as you are making payments to your creditors you still be on the credit testimony for the duration in which you have to pay. IVA can certainly prove to be a perfect way for the people who need to start their journey towards a debt-free future without having the stress of filing liquidation. There are few career options where bankruptcy can make life difficult. Such careers include people doing job in civil service, armed forces and legal services. Even if don’t have a career in any one of these fields, you still may find a bankruptcy clause in your employment agreement.

For some people going for IVA (individual voluntary arrangement) can prove to be the only option left for their survival from debt. However, an IVA should not be taken lightly in any scenario. It is because it is a lawful arrangement which necessitates anIndebtednessExpertto set it up amongst you and your creditors. The period of this arrangement can certainly not exceed five years. I hope this post help you know about IVA in detail and how it can provide help to you if you are in deep debt and need to get out of it in an effective manner.

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