Regulatory bodies have recently voiced concerns at some marketing companies are placing adverts across the media describing IVA as ‘IVA Gov backed schemes.’
To describe an IVA as a Gov backed scheme is really not accurate at all as, by doing so, the reader of such an advert could easily be led to believe the UK Government would, in some way, be financially or morally backing their IVA, a claim which is totally incorrect.
But what would drive a company to claim the IVA is Gov backed ?
Well, it could be down to a company trying to over simplify the the description of the IVA process as part of a marketing strategy, something which the Office of Fair Trading is keen to clamp down on.
The OFT believes some people are being misled through such advertising and may, ultimately, find themselves being subjected to poor standards of debt advice by the companies using such techniques.
In fact, it would be more accurate to describe IVAs as being supported by Government due to the fact that IVAs form part of the 1986 Insolvency Act and, therefore, are embedded in the United Kingdom’s statute or law, which is a completely different claim.
Therefore, in the hope of providing some clarity to those confused by the situation, here’s some of the general points you need to understand if you are asking yourself, just what is an IVA?
An IVA is a formal debt solution, which helps people with a severe debt problem to reach an new arrangement with their creditors.
An IVA is an alternative to bankruptcy.
The arrangement will be for a fixed term, which is usually 5 years, and will be made up of repayments which are based on affordability.
The benefits of entering into an IVA for the applicant can be substantial.
The fixed affordable repayments and the fixed time span of the arrangement often come together to create a substantial amount of the original debt being written-off.
Other benefits or IVA Pros include:
- Fixed affordable and reduced IVA repayments.
- Fixed term of the IVA agreement which is normally 5 years.
- Possible debt write-off at the conclusion of an IVA
- No further legal action by creditors
- No creditor contact through-out the IVA.
- Unlike bankruptcy, IVAs are not published in the press.
- Professionals can use IVAs as an alternative to bankruptcy.
- Legally binding on all creditors, once the IVA has been agreed.
- IVAs will protect large assets such as equity in your home.
- IVAs will leave you completely debt free, if completed successfully.
- You retain a degree of financial control whilst in an IVA.
These are the most regularly quoted IVA benefits, although this list is not exhaustive by a long way.
Not everybody that wants to enter into an IVA will meet the necessary criteria and, therefore, if you are considering the IVA as an option, you should see if you qualify for an IVA first.
An IVA must also be administered by an Insolvency Practitioner.
It is often said that an IVA will bring a different set of benefits to each and every IVA candidate, which will be entirely due to the circumstances of each particular case.
If you would like to investigate how an IVA would benefit you and help you in your circumstances, then why not ask My IVA Adviser for a ‘no obligation’ consultation.
Each IVA consultation is confidential and will allow you the opportunity to see just whether or not an IVA would be a suitable debt solution for your personal circumstances.
Simply call 0800 088 7503 to arrange your ‘no obligation’ consultation.
Alternatively, fill in the form of the side of the page or complete our quick contact form, then we’ll call you at a convenient time for you.
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