Monday 20th of July 2009
Individual voluntary arrangements (IVAs) are approved for an increasing number of Britons as creditors lower the payment thresholds required, it has been reported.
The main attraction of IVAs is that they are an alternative to bankruptcy and allow people to reduce their debt into a single, more manageable, monthly repayment, the Independent stated.
Creditors also prefer debtors seeking IVA help than turning to bankruptcy, it added, because they can receive more of what they are owed in a shorter period of time.
Speaking to the newspaper, Beccy Boden Wilks from the National Debtline said that while people in debt do tend to focus on how their monthly payments could be lowered, "that isn’t the main figure to look at. It’s about making an informed decision and knowing exactly how much it’s going to cost".
Britons who have considered IVA support may have researched whether this debt solution is the best for them. However, unlike bankruptcy, an IVA can be carried out privately, without the need to notify the local newspaper.
It has recently been reported that former Secret Millionaire Chek Whyte, an Ilkeston-born entrepreneur, was considering an IVA as one way to clear his £4.98 million in 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
- Information on IVAs could help credit card users exercise caution
