Credit and debt news
IVAs can be a lifeline
15 June, 2007
Individual Voluntary Arrangements (IVAs) are an 'absolute lifeline' if used and proposed correctly, an industry expert has declared
Andy Davie, spokesperson and site manger for IVA.co.uk, revealed that the creditor receives more dividend than through bankruptcy and the debtor has the chance to start their life again five years after entering.
An IVA is a formal agreement between the person in debt and their creditors to make reduced payments towards the total amount of debt in order to pay a percentage of what is owed.
Generally, the debt is classed as settled after five years and Davie said anyone thinking of entering an IVA should speak to two or three different companies before they committed.
He added that people should meet their company's Insolvency Practitioner to make sure they understand the ins and outs of IVAs: "Many people post on the site and the first thing they say is: 'I'm so glad I found this site'. Because in debt you can sit alone; a lot of people don't even talk to their family about their debt problems, so when people come across the website and think: 'I'm not the only person', it can be very comforting for them."
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