What is an IVA why are more people turning to it?
Many people in the United Kingdom at the moment I’m looking for Debt Solutions as personal debt is at an all-time high.
The average amount of debt per UK household is in excess of £54,000, meaning that much of this will be in unsecured debt but also some of this will be mortgage debt.
So what are some of the pros and cons of this debt solution (the IVA)
With an IVA, pros and cons are many and varied as detailed on that page.
One of the key advantages of the IVA is that it enables the person in debts to take care of the lower priority debts which leave space to bettor handle the highest priority debts such as HMRC debts, mortgage debts, and other more pressing financial liabilities such as guarantor loans and other liabilities.
In a nutshell, people in. I’m not handling their debts as efficiently as they were years ago, this is backed up by the fact that the average amount of time spent in debt in comparison to 20 years ago is much higher comma in fact the average person’s credit card debt is in excess of £2,000 in the UK.
One of the key reasons why more and more people are turning to the IVA as a debt solution is due to the fact that you don’t have to suffer the same downsides as with bankruptcy and it enables you to write off your debts over the course of 5 years whilst making reduced payments to your creditors, not only that but she will also have a dedicated professional known as an insolvency practitioner who will managed and be the new points of contact with your creditors so therefore you don’t have to have any Direct contact.
The IVA also offers legal protection against hassle from creditors, this is known as an interim order and many people find this a useful advantage of the IVA because it helps to reduce stress whilst managing debt and also when endeavouring to become debt free
Another key advantage of the IVA is the fact that up to 85% of debt can be written off in many cases, meaning that for example if someone index had £100000 of liabilities up to £85,000 of this could be written off completely once the IVA is finished, which many would agree is an enormous amount of money to be written off as debt.
Also one of the lesser mentioned advantages is the fact that with an IVA generally all debts are extinguished within a timeframe of 60 months which is 5 years, unless there is equity in the home in which case it may be necessary to remortgage your home in order to repay extra outstanding debt however most of years are completed within 60 months, which is a remarkably short time for him to become debt free if for example you have £50,000 worth of debt which is entirely possible through an IVA
What about disadvantages of ivas?
Many people ask about potential disadvantages of ivas, a lot of this is down to perception because the IVA is designed to get you out of debt however it does require discipline and it does require restrictions to be placed on expenditures.
If you are of the expectation that you will be holidaying in Barbados 4 times per year then whilst on an IVA you may find yourself disappointed due to the fact that you’re expected to show as much dedication to the procedure as is necessary to get yourself out of debt as quickly as possible
This debt management scheme is designed to help you but also requires discipline if that is seen as a disadvantage of the plan then that is unfortunate.
One disadvantage of the IVA debt management scheme is that it is more difficult to procure credit then if you were not on the scheme, however if you are in debt it is generally considered a good idea to avoid taking on extra credit.
When it comes to IVA and the pros and cons associated with ivas there are many and varied however the positives are outweighed by negatives if you would like to make an enquiry about the IVA get in touch through this link for more information.