The advantages of IVA services

The Individual Voluntary Arrangement popularly known as an IVA was introduced as an legal binding alternative to bankruptcy by the Insolvency Act of 1986. The logic behind the introduction of the IVA was to empower people facing financial difficulties to come to a formal agreement with their lenders rather than filing for bankruptcy. When an IVA is agreed between the debtor and creditor following things happen.

• Interest on the the total loan amount is frozen


• Legal proceedings against the concerned person are stopped


• The overall debt burden is also reduced

IVA is different from debt management. The debt management services are unregulated and not legal binding. On the other hand, an IVA is a legally binding agreement and is supervised by a Licensed Insolvency Practitioner.

This agreement is generally seen as a more favourable option than bankruptcy from both the debtor's and creditor's side. This is because there are no fees or legal proceedings involved with this agreement, unlike with bankruptcy. Furthermore, from the lenders point of view, this agreement offers a greater repayment of the debt than would otherwise be achieved if the borrower was made bankrupt.

The benefits of an Individual Voluntary Agreement

The IVA services are the extremely effective way of helping people to get rid of their mounting debt problems and to make a fresh start. The main advantages of these services are:

• As the agreement is highly regulated it is unlikely to be open to abuse by those IVA services providers


• An IVA doesn't affect the professional status of the concerned person or his ability to hold public office


• With an IVA the concerned person only pays back an agreed percentage of his/her debts


• While an IVA is in force, it is illegal for the lenders to harass the person- and they normally agree not to contact the borrower during this time frame


• This agreement enables you to have a regular bank account as long as it doesn't have an overdraft facility


• With an IVA, the total interest on your loan is frozen which means that there is no chance of debt snowballing

When the IVA services can benefit you ?
The IVA services are beneficial under the following circumstances. They are extremely advantageous when

• You owe money to people or companies who do not agree to an informal debt management arrangement


• You have already tried for an informal arrangement, but without any success


• You owe money to more than 3 creditors

You are facing a possible bankruptcy and you want to reverse your financial situation

How do the IVA services work

• Get in touch with the IVA services provider. The friendly and experienced IVA advisers will discuss your financial situation and answer any queries that you may have about arranging this agreement


• The IVA advisers then add all your debts together and calculate a realistic and affordable monthly payment according to your monthly income. This new outgoing is normally far lower than the monthly payments you are currently making


• A licensed Insolvency Practitioner acts on your behalf to agree this reduced payment with all of your lenders


• When the agreement is accepted by 75% of your lenders and the IVA has been approved, all interest charges will be stopped, and you need only pay off the reduced amount of loan within a time period of 5 years

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For more information about loans: IVA Services , Make your financial behaviour reasonable , Unsecured Loans: Best Financial aid to serve your needs better

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