IVA Advice – How to Get the Most Out of an Individual Voluntary Arrangement

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If you are struggling with debt, you might be considering using an Individual Voluntary Arrangement (IVA). This is a debt relief strategy that is a bit of a hybrid between bankruptcy and a loan. It can help you clear your debts faster and at a lower cost. The IVA process can also be useful for improving your long-term financial health.

An IVA is a legally binding contract that requires you to repay unsecured creditors over a set period. These payments are based on your income and the number of unsecured debts you have. It will also take into account the size and cost of your living expenses. However, an IVA can be a complicated process, and it is best to seek professional assistance if you want to get the most out of it.

IVAs are a popular alternative to bankruptcy. They allow you to make smaller monthly payments to creditors while still being able to enjoy a normal lifestyle. The downside is that it may reduce your credit rating. If you are a homeowner, you may be asked to re-mortgage your home during the second year of an IVA. It is important to remember that IVAs can last anywhere from five to six years.

The IVA can also be a good opportunity to start building a strong credit rating. This is because you will be able to use some of the money you pay into an IVA to make additional contributions to your creditors. Depending on your circumstances, you may have to sell some of your assets to pay off your debts.

When you apply for an IVA, you will need to complete a number of forms. For instance, you will need to declare the name of your IVA adviser to your employer. You will also need to provide proof of your income and the number of creditors you owe. In addition, you will need to prepare a budget for the repayment of your debts.

When you sign up to an IVA, your IP will prepare a proposal for your creditors. This will likely include a number of items such as a budget for the repayment of your debts, a list of your debts and their corresponding monthly payments. Your creditors will then have up to three weeks to decide whether or not to accept the proposal. If they do not, you will not be able to continue your IVA.

The IVA also has a lesser-known cousin: the Debt Management Plan (DMP). This is a similar process but you will make regular payments to your creditors rather than one lump sum. A DMP is not for everyone, though, so you should get IVA advice before signing on the dotted line.

The IVA also has a number of other functions. It can help you get out of a CCJ or bailiff visit, stop a levy on your property, and provide a means to stop court fines being added to your debt. It can also help you avoid bankruptcy.

IVA Advice – How to Get the Most Out of an Individual Voluntary Arrangement was first seen on Debt Worries