Sunday 5th of September 2010
Individual voluntary arrangement (IVA) questions could show cash-strapped Britons how to put a stop to their borrowing and cut their spiralling unsecured debts.
Figures from Unbiased.co.uk reveals growing numbers of people are attempting to pay back what they owe at the expense of their savings.
The data from the price comparison website shows Brits are now repaying 7p of debt for every pound saved in the second quarter of 2010.
Commenting on the news, Jo Parsley, advocacy and media officer for Credit Action, says: "There has been a need for consumers to get on top of their finances for many years, as personal debts grew over the noughties, reaching levels that were unsustainable."
He added a country of "out-of-control borrowers" is extremely dangerous both for consumers and the economy.
Asking questions on IVAs may, however, show people who are constantly taking out credit to stay afloat that it is possible to get out of their cycle of borrowing and get their finances back on track.
The method of insolvency helps you wipe out your unsecured debts over a period of five years and may be more favourable than bankruptcy, which requires details of your money troubles to be published in the local paper and doesn't protect the equity on your family home.
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
- Could you avoid Gordon Ramsay's court threat with an IVA?
