Simply speaking, the definition of an individual voluntary arrangement or an IVA is a formal and legal contract to pay back your debts to your creditors that both you and your creditors agree upon. The contract is fulfilled over a period of time.
Generally an IVA is flexible in many ways as it conforms to your requirements. On the other hand, it can be expensive and risky as well.
IVA Contract Benefits
Some benefits of an IVA are:
- It’s legally binding
- It’s time limited to usually 5 or 6 years
- You usually can pay only part of the debt
An IVA might be right for you if:
- Your arrears exceed £6,500
- There are at least 2 different creditors you owe money to
- You prefer to deal with your creditors indirectly
- You can make IVA payments every month
The IVA is a flexible option. For example, you may be able get an IVA if your debts don’t exceed £10,000. So, if you don’t meet all of these criteria, don’t lose hope.
An IVA might not be right for you if:
- If you don’t have a fixed income or a permanent job
- You work in accountancy, law or financial services
- You don’t have any spare income or a lump sum available to pay your creditors
Keep these facts in mind before you opt for an IVA. Fill up a quick contact form to make an informed decision.