Monday 4th of January 2010
People often do not know how to sort their debt problems, despite them potentially suffering from stress, depression and anxiety as a result, a claim suggests, although an individual voluntary arrangement (IVA) could reduce such problems.
Last year, almost half of the UK population were worried about debt and their finances, the Department of Health reveals.
Some of the biggest concerns which caused depression and stress could have been whether or not a family home would be repossessed and whether lenders would send people round to demand money.
An IVA may answer such concerns. As long as repayments are met each month at the new reduced rate, a home does not need to be repossessed.
Furthermore, lenders are advised that all contact should be made through a specialist IVA negotiator and they cannot take further legal action so long as the terms of the agreement are met.
A quarter of people with mental health problems will experience debt at some point.
"Tightening our belts and getting out of debt always features high on the list of new year’s resolutions," says Phil Hope, care services minister.
An IVA could help people meet their 2010 goal of starting to repay their unsecured debt.
By Chris King
- House price rise 'may not indicate recovery'
- Equity release 'needs to be increased'
- Need for IVA help could increase as expert predicts reduction in lending
- Government announces 'breathing space' for those needing IVA help
- Lack of subprime lending creating need for IVA help, expert suggests
- Big spenders may be in need of IVA FAQs
