How to Apply For an IVA
Whether you are looking to buy a home, get a new mortgage or make a big purchase, you may want to consider applying for an IVA. Individual voluntary arrangements (IVAs) are a type of debt solution that allows you to pay off your debts over a period of time without wiping out all of your disposable income. You can opt for an IVA in Wales and England, and in Northern Ireland. However, not everyone is eligible to enter into an IVA. There are some guidelines to follow before you apply for an IVA.
The IVA is only available for certain types of debt, such as credit cards, store cards, mortgage shortfalls, and council tax arrears. An IVA is a legal arrangement where a debtor and his creditors agree on a monthly payment that will be used to pay off the debts. In exchange, the interest on the debts will be frozen by law.
When you apply for an IVA, you will be asked to provide a lot of information about your financial situation. This information will include your income and expenses. The Insolvency Practitioner (IP) will review your situation and make an offer to your creditors. Depending on your situation, you may be offered an IVA with lower payments or a payment holiday. You may also be offered an extra allowance for special circumstances.
A typical IVA will last for five to six years. You will make one monthly payment to the IP, who will then distribute the money to your creditors. You may have to make lump sum payments into your IVA, or you may be required to pay them off over a longer period of time.
Depending on your credit rating, you may not be able to get a new mortgage or get a good rate of interest on a new loan. This can put your home at risk. In some cases, your IVA can be ended early if you re-mortgage your property. It is a good idea to shop around and find the best service for your needs.
An IVA can be a good solution for some people, but not for others. If you don’t make your payments, you may be forced to file for bankruptcy. An IP may also ask you to stop making personal pension contributions. It is important to get independent advice before you apply for an IVA. You may also need to pay an up-front fee before you can start the process.
An IVA will also appear on your credit record for six years. It is a good idea to read up on the IVA protocol to see if it is right for you. This will help you understand the IVA process and the details involved. A good IVA provider will be able to help you decide whether an IVA is right for you. It is also a good idea to ask questions to ensure you are getting the right information.
An IVA may be a good solution, but you may be surprised to learn that it can be difficult to get one approved. You may be offered unrealistic monthly payments, or the IVA may not work for you at all.
How to Apply For an IVA was first seen on Apply for an IVA