Individual Voluntary Arrangements (IVA's)
Merits:
An Individual Voluntary Arrangement is a very effective way to become debt free in a relatively short period of time. The benefit of the arrangements being backed by the government gives reassurance that no negative terms can be introduced which you do not agree with. There are however positives as well as negatives to consider.
Advantages
- You will be debt free within five years
- The cost of the IVA will be set at a level which is affordable for you
- Communication with creditors will cease and no further chasing will occur
- Your credit rating will be restored one year after the completion of the IVA
- All interest will be written off in structuring the agreement
- You can maintain control of your assets principally your home
Disadvantages
- It will be difficult to secure new forms of credit during the period of the IVA
- Depending on the terms of your IVA you will have to pay over part of any windfall gain to your creditors
- Failure to broadly maintain the terms of the IVA is likely to result in bankruptcy
- If you are a homeowner it is likely that a term of the IVA will include a provision to remortgage in the final year of your agreement
Use our FREE Credit Report to see if you are eligable for an IVA.
IVAs: Main
IVAs: Criteria
IVAs: Considerations
IVAs: Costs
IVAs: Merits