Falling into the chasm of debt that becomes an unmanageable nightmare is not something to be taken lightly but it is something that can happen surprisingly easily. It’s all about the tipping point. The amount of your debt can creep up almost without you knowing it and whilst finances can get tighter and more difficult you still manage to get by.
But there comes a point where it changes. This is the point where you struggle to meet even the minimum payment and the charges and penalties start to add to your debt. It’s the point where you struggle to secure additional credit to help you through. It’s the point where you get sucked into the payday loan stranglehold. It is very much the point where the real anxiety and worry starts. This is the point sometimes referred to as the start of the downward spiral of debt.
Demands from lenders, collection agents at your door, services being cancelled, punitive charges everywhere you look, difficulties making ends meet and blinding worry make it a very unpleasant place to be. But it happens to thousands of people every day of the week. For many it can seem as if there is no way out.
IVAs sort the problem
Well the good news is that there is a solution to serious debt problems and it comes in the shape of an individual voluntary arrangement or an IVA for short. This is a straightforward and very effective option to sort out your debt problems. It enables you to enter into an arrangement with your creditors where you agree an affordable monthly payment over a period which is usually five years and then for the rest of your debt to be written off. Once agreed it becomes a legally binding agreement which all your creditors have to abide by. They can no longer harass you for payments or take legal action against you as long as you stick to the agreement.
IVAs have been around for a long time and are a proven solution to help people draw a line under their debt problems and free themselves from the absolute misery of debt. An insolvency practitioner is required to administer the process and ensure all legal formalities are followed. The IP will also take on the responsibility of dealing with your creditors, which for anyone who has had a debt problem will know is a real benefit.
Like many of the main debt solutions there are downsides to be considered before applying for an IVA which include aspects such as the fact that your credit rating will be affected, you may have to release equity if you are a homeowner and there is an entry made on the insolvency register. Some say it’s a small price to pay for the difference an IVA can make to your life.
Seek out professional advice
One of the best things you can do is to find professional IVA advice as an experienced advisor will be able to determine in the first instance if an IVA is the right solution for you. Their expertise is invaluable and they will help with key points that you probably hadn’t even thought about. Good debt advisors are also able to guide you through the legal process so you know what to expect.