IVA in Mexico – What is an IVA and How Does it Work?
IVA is a value-added tax that is applied to the sale of goods and services. Generally, this tax is charged on the sale of imported materials, distributed goods, and services. The current IVA rate in Mexico is 16%, but there are some exceptions. For example, if a company sells a product that is not taxable, they may be exempt from paying IVA. Similarly, a company that imports a finished product to use in another country may not be required to pay IVA on that product.
The first step in the process is to talk to a free debt adviser to find out if an IVA is a suitable option for you. The adviser will tell you whether you are a good candidate for it and which steps you need to take. Then, you need to decide whether you can afford it and how much you can pay each month. Once you know how much you can pay every month, you can proceed to the next stage.
If you do decide to enter an IVA, you should keep in mind that the process can negatively affect your credit score. Your IP may try to persuade your creditors to accept your new agreement, but the IVA will remain on your credit report for up to six years. This can significantly impact your ability to get further credit.
A successful IVA requires the approval of 75% of your creditors, ‘by value’. This means that creditors with the highest value in your debt will usually vote against it. If your creditors are not satisfied with your IVA proposal, they may try to haggle over the terms and conditions of the arrangement. This may involve them asking for more money, including assets, or asking you to make payments over a longer period.
In recent years, IVA technology has steadily made its way into the modern business landscape. This technology has gained significant traction, especially following the pandemic of 2020, which forced brands to accelerate their digital transformation strategies. In fact, usage of IVAs increased by 46% in 2020, according to Gartner. Although the benefits of IVA technology may not be immediately apparent, if implemented correctly, IVA will transform the way customers engage with your company.
A successful IVA can have a positive impact on your personal and professional life. When properly managed, an IVA can help you regain control over your finances. It will also allow you to rebuild your credit profile. So, it’s important to remember that you must meet the conditions of your IVA to ensure success.
The duration of an IVA varies depending on how much equity you have in your home. If your share is worth PS5,000 or more, you must either apply for equity release or remortgage your property. The process will require you to pay 15 percent of the property’s value, and your new mortgage must last until you reach state retirement age. If you’re able to do this, the IVA will be shorter – around five years.
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