Friday 14th of May 2010
If you owe money on credit cards and personal loans, you could find it’s becoming increasingly difficult to pay due to soaring interest rates on these types of financial products.
Information on individual voluntary arrangements (IVAs) could therefore offer a helping hand if your unsecured debts mount up to more than £15,000.
IVAs freeze the interest on the money you owe, meaning you may be able to overcome the rising rates of plastic and personal loans.
According to Defaqto, the average interest rates for such financial products have grown significantly over the last few years.
And spokesman for Moneyfacts Darren Cook says this is because the economic downturn means lenders are more worried about people defaulting on their credit, resulting in rising costs being "passed on to the consumer".
Seeking info on IVAs may therefore be a wise choice if you’re struggling to afford your debt repayments and this is having a big effect on your ability to pay for other essential, everyday items.
IVAs are only available for people who are employed and have the means - and discipline - to meet the reduced-rate monthly repayments, but they could have you out of the red after around five years.
By Kimberley Parsons
- 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
- Bankruptcy and IVAs predicted to rise
