The Ups And Downs Of Getting An IVA Agreement
You find yourself struggling to keep up with the monthly repayments that you need to keep making to all of your creditors. If you find yourself in this situation then you will more than likely want to find a solution to your problem. An increasingly popular method of doing this is by setting up an Individual Voluntary Arrangement or IVA agreement. This can be an extremely effective way of alleviating your debt problems but it is important that you understand the ins and outs. We have given you a brief outline of the biggest positives and negatives that can occur with these plans.
Advantages.
By setting up a debt payment plan in this way, you will only have to make one payment each month, this will be calculated specifically for you so that it is affordable.
Within 5 years you should be free of all your debts and in some cases it will be within a much shorter time.
Another plus point is that you will not incur any further late payment charges or added interest during the term of the arrangement.
Once the plan is in place you should not have any further correspondence from any of your creditors. If you receive any phone calls or letters then you simply pass the details on to the company managing your arrangement.
Disadvantages.
These agreements are only available to people whose overall level of debt is more than £12,000. If your debt is lower than this then you need to look for another alternative.
Your credit rating is going to be severely affected, you will be unable to borrow for the length of the agreement and may struggle for some time afterwards.
These arrangements will last for 5 years as opposed to 3 for bankruptcy and as well as the longer term, you are also required to pay a lot more with these.
During the course of the agreement you will not be able to use any unsecured credit, this means no store cards, credit cards etc can be used.
Obviously if you are considering an IVA agreement then you should do thorough research into the subject first. If you have weighed up all of the pros and cons and still want to go ahead with it then make sure you look for a reputable firm to get you on the road to being debt free.
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