Individual voluntary arrangement (IVA) is plan that was introduced by insolvency act of 1986 to provide an alternative to being declared bankrupt.
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Benefits of IVA
Individual voluntary arrangement (IVA) is plan that was introduced by insolvency act of 1986 to provide an alternative to being declared bankrupt. It enables people with serious debts to draft a proposal to all the people they owe so that they agree on how to settle the debts. The IVA acts as binding legal contract that binds the debtor and the creditors if approved by court. It prevents the creditors from taking any further legal action for a period of five years in which the debtor pays the debts on a monthly basis according to the stipulated amount.
Benefits of IVA
IVA plans have the interest on the loans scrapped off. The legal proceedings against the debtor are halted and the total debt is reduced.
Significance of IVA advice
It is advisable to contact a very competent insolvency practitioner to advice on how to go about getting a relief from being declared bankrupt. This is important because the duration of repayment is going to be five years and therefore the debtor has to understand stipulated conditions for repayment to a void faulting in law.
Factors to consider when looking for IVA advice
It is important to identify the right companies that are credible and competent in handling IVA plans because nonprofessional companies may mislead one to get further into more financial problems by providing wrong advice.
What to scrutinize before settling for IVA advice
• The IVA advice should not take any sides
• IVA advice should incorporate views of both the debtors and creditors
• The IVA advice should be comply the debt recovery legislation
• Advising companies should have experience in handling IVA plans.
Notably, the advice is a critical factor that determines the credit rating of the debtor in future.Therefore one has to identify the most appropriate company that can advice on the IVA plans to avoid being subjected to further financial strains or bankruptcy.