Settle Debts through IVA
What is the purpose of an IVA?
The purpose of an IVA proposal is to help people in financial difficulty settle their debts in a more structured and manageable way, while showing creditors that they would be better off accepting the IVA proposal instead of petitioning for bankruptcy.
Why use an IVA?
If you abide by the terms of your IVA proposal it really can be your “Light at the end of the Tunnel”.
- You and your creditors agree that you will make a single, manageable payment each month.
- An IVA lasts for a fixed, sensible period of time – most commonly 5 years.
- Once agreed, the law prevents creditors from continuing to charge interest on outstanding balances.
The terms of the agreement are fixed at the outset which means that creditors cannot suddenly demand changes to it and once agreed, creditors are bound so they can’t change their mind and take their own action against you.
Informal debt solutions may not offer you such peace of mind as it is often questionable whether informal agreements with creditors are legally binding (potentially allowing individual creditors to independently continue with enforcement action against you).
If an informal debt solution is utilised creditors may require you to continue to make contributions from your income for however long a period as may be required to settle your liabilities in full. Creditors may also continue to charge interest throughout the period required for repayment of your indebtedness.
Next >> How does an IVA work?
Call us on 0800 88 18 274 to find out how we can help at the Debt Helpline
Copyright 2006 Debt Help line. All Rights Reserved | Consumer Credit Licence Number 576616