Under what circumstances would an Individual Voluntary Arrangement (IVA) be suggested as
the most appropriate debt solution, when a consolidation loan is also a possibility ?
A
consolidation loan is a generally a good vehicle for repaying your outstanding debts.
After all, a consolidation loan will, in most cases, reduce your monthly out goings, and therefore take some of the
financial pressure off. A consolidation loan will also reduce the amount of creditors you have to deal with, therefore making your finances easier to manage, and as long as you manage to keep up the repayments a consolidation loan will also protect your credit worthiness too.
But there are some situations that arise where a consolidation loan will actually become a less suitable solution when compared to
an Individual Voluntary Arrangement (IVA).
It is likely that if you have a serious debt problem, and are searching for a solution, you will be fully aware of the ‘consolidation loan’ product and what it can do for you.
Chances are that you
have already tried the consolidation loan approach, through your bank or building society already, and now find that your credit cards and overdraft have built up again, leaving you with even less money each month than you had before the loan.
There is an old saying:
‘You can’t get out of debt by taking out a loan.‘
This is why an Individual Voluntary Arrangement (IVA) is such a good solution.
An Individual Voluntary Arrangement (IVA) is a ‘
non borrowing‘ option.
- An Individual Voluntary Arrangement (IVA) allows you to reduce your outgoings to an amount of money you can afford each month.
- An Individual Voluntary Arrangement (IVA) reduces all your payments into one affordable monthly payment, which is therefore easier to manage.
- An Individual Voluntary Arrangement (IVA) has a fixed time period, so you will be able to see when you will be debt free.
So in many respects an Individual Voluntary Arrangement (IVA) has all the advantages of the consolidation loan.
But crucially, there is one huge difference.
You will be debt free when your Individual Voluntary Arrangement (IVA) is completed.
Your creditors will be obliged to write off the balance of any of your debts when the Individual Voluntary Arrangement (IVA) has been completed successfully, whether or not you have repaid all the money you owed before the Individual Voluntary Arrangement (IVA) started.
This means that you will be debt free in
60 months. No more debt to worry about, no more consolidation loans.
If you would like further information on the Individual Voluntary Arrangement (IVA) option with all the
IVA pros and cons, then call
the debt specialists at
My IVA Adviser on
0800 088 7503 anytime and have a chat with one of or
IVA specialists. They will be able to help you examine the
consolidation loan versus Individual Voluntary Arrangement (IVA) choice, and give you good impartial advice, for
free.
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