Solving Your Debt Problems
With the recent credit crunch hitting the whole country hard, many people have been struggling with mounting debts that spiral into thousands of pounds. The level of debt can become increasingly difficult to manage and this has lead to an increase in IVA Debt Solutions being arranged. What exactly is an IVA though and how can it help people to cope with the amounts that they owe?
An Individual Voluntary Agreement (IVA) is a repayment solution that is set up between the person owing money (debtor) and the people that they owe money to (creditors). As people attempt to rid themselves of the debt that they have mounted up, these agreements are becoming increasingly popular.
Setting up an IVA means that the debtor can pay off a percentage of the amount owed by making smaller monthly payments throughout the course of the agreement. These solutions are usually made with a time period of five years.
During the IVA, the creditors are legally bound to freeze the interest on any outstanding debts and to cease adding late payment charges to the debtor's account(s).
The creditors are also not allowed to get in touch with the debtor in any way when an agreement is set up. Any correspondence must be passed through the appointed Insolvency Practitioner's office under the terms of the Individual Voluntary Arrangement.
Once an IVA has been successfully completed any outstanding balances must be written off by the creditors, in many cases as much as 75%! Meaning no more debt for the people involved.
The size of the monthly repayments to the IVA are calculated with the help of the debtor providing the relevant documentation and are based on what the debtor can realistically afford throughout the term of the IVA.
There are a few minimum requirements that are needed in order to qualify for an IVA.
The amount owed has got to be at least £15,000.
There must be at least three separate creditors.
Debtors must be in receipt of a regular income which is not wholly dependant on benefits.
If you meet the criteria mentioned then you could significantly benefit from arranging an IVA Debt Solution so you should take some time to look into your available options.
