Pros and Cons of an IVA
IVAs or Individual Voluntary Arrangements have become increasingly popular as a solution for debt problems, as they can reduce your overall debts by up to 75% in some cases, and clear them completely within 5 years, all while keeping to a single affordable monthly repayment.
To enter into an IVA you will need to be advised by a qualified and licensed insolvency practitioner, but this brief summary of the good and bad points will help you decide if this is a debt solution you wish to look further into.
IVA Benefits:
- An affordable monthly repayment
- Avoid bankruptcy and keep your home and car
- No more recovery or legal action against you
- Interest charges frozen
- Debts reduced by up to 75%
- Outstanding debt written off after 5 years
- You can propose a repayment to fit your budget
IVA Drawbacks
- Damage to credit rating which will last beyond the period of the IVA
- IVA period lasts 5 years compared to bankruptcies which are discharged in 3 years or less
- Failing to keep to the terms of an IVA will almost certainly lead to bankruptcy
- You have no access to further credit facilities during the 5 years
© 2008 Debt Sorter
