Global credit crisis has affected the UK financial market adversely. Easy loans are now a matter of past. Even on secured loans, getting LTV (Loan to Value) more than 75% is now hard to avail. But, the per capita credit card presence remains at an alarming high-2.9. Credit card and unsecured loan burden on Britons have increased significantly in last five years. They are creating a vicious circle of debt and hampering the smooth functioning of life.
Individual voluntary Arrangement or IVA is a legal binding agreement helping Britons to become debt free easily. All UK residents including sole traders and partners can opt for IVA to get rid of debt trap. In the first step of IVA, Insolvency Practitioner submits a proposal to court regarding an interim order to prevent creditors from reposing residential property of the debtor. Then a creditors meeting is being arranged by the Insolvency Practitioner. If 75% of the creditors give a nod to the proposal, Individual Voluntary Arrangement comes into force.
The best part of IVA UK is that it helps you to become debt free within a time span of 5 years. A repayment plan is prepared according to your monthly income, total debt burden and capacity to repay. You have to follow this repayment pattern throughout the IVA tenure. Once the period is over, you are declared debt free even if you have not repaid the debt completely.
In case of IVA, your identity is not disclosed. Hence, there is no risk to your job if your position includes public responsibility. During the IVA tenure, the lenders can not repossess your home or any asset. However, IVA is applicable for clearing unsecured debt burden only. In case of secured debt burden, you can take help of remortgage, debt consolidation or bankruptcy (at the extreme situation).
