Tuesday 17th of November 2009
New bankruptcy laws "make sense," says the Consumer Credit Counselling Service (CCCS), but there could still be many people for whom individual voluntary arrangement (IVA) advice could be a better course of action.
The Department for Business, Innovation and Skills announced last week that it would be possible for indebted Britons to apply for bankruptcy online and through the post.
This will undoubtedly make the process easier and quicker for cash-strapped consumers, believes the CCCS.
However, a spokesperson warned: "It is important to remember that bankruptcy has many longer term impacts on your life; such as blacklisting for future credit, restrictions on job roles and the loss of all assets."
In some cases, these factors could make an IVA a more appealing prospect for debt-stricken people.
An IVA does not necessarily result in debtors losing their assets - such as the family home.
It is also, as opposed to bankruptcy, a private matter that will not be freely available to friends, family and work colleagues.
By Rachel Powell
- 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
- IVA questions could offer support to struggling self-employed
