Friday 3rd of September 2010
Individual voluntary arrangement (IVA) FAQs might offer significant information for people who are finding it increasingly difficult to keep up with their unsecured debt repayments.
Figures from sunshine.co.uk show some 28 per cent of UK adults admit to borrowing cash to spend exclusively on a holiday, with 20 per cent of those stating they'd rather be in the red than not have a vacation.
In addition, the data reveals 51 per cent pay for their trip on a credit card, with 68 per cent of respondents saying they borrow cash to splash on a getaway on a regular basis.
Researching IVA FAQs may, however, be a wise choice for those who take out credit for a holiday and then struggle to pay it all back.
A spokeswoman for the Consumer Credit Counselling Service says "it could take years or a decade" to repay money owed on plastic "if you're paying just the minimum amount".
She adds: "The longer it takes to pay off, the more it's going to cost you. If you can, try and pay the full sum each month, if not then as much as possible. Paying the minimum amount unless you absolutely have to for a very short amount of time is going to cost you a lot more in the future."
Furthermore, the representative explains it could be the sign of a serious debt problem if you can only repay a small figure every month.
An IVA could offer a helping hand if you're in a similar situation and only just able to keep your head above water.
The method of insolvency is only available for those of you in full-time employment who owe more than £15,000 on unsecured financial products to three or more creditors and requires a great deal of discipline and hard work to complete.
But you may find the effort is worth it, as the measure cuts your debts over a period of around five years - with the help of reduced-rate monthly repayments - and could leave you completely debt-free.
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
- Information on IVAs may benefit under-pressure families
