Thursday 29th of October 2009
Individual voluntary arrangement (IVA) advice could be of great help to the increasing number of people who are choosing to pay off debts despite the ongoing recession.
During the last three months one-third of people have started making repayments on non-mortgage debt, or increased the rate at which they pay, compared with 25 per cent in the previous quarter, according to the Association of British Insurers (ABI).
And consumers are now more optimistic about the economy than at any time in the last year, with more than half expecting the financial outlook to improve in 2010.
Dr Rebecca Driver, the ABI’s director of research and chief economist, said: "For the long-term health of the economy, it is encouraging that more people are reducing their debts."
Some people may want to take out an IVA in order to make the most of their ability to repay unsecured debts, such as credit card bills.
An IVA could freeze interest rates on unsecured debt, removing the threat of having to splash out more cash just to meet interest demands.
Last week it was reported that all but two of the UK’s credit card companies have increased their rates in the last year, so an IVA could be the ideal way to protect against this.
By Neil Burton
- 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
- Is your head in the sand when it comes to finances? IVA answers may be useful
