What is an IVA and What are the Standard Conditions for an IVA in the UK?
There are mortgage payments, car payments, and credit card payments that are just a few high priced bills people are faced with on a continuous basis. Then there are light bills, water bills, and groceries to buy. With so much to pay and not enough money to pay it, life can get extremely stressful. Some people start considering ways as to how they can become debt free but instead of filing for bankruptcy there are other options. One option is an IVA. What is an IVA and what are the standard conditions for an IVA in the UK?
An IVA is also called an individual voluntary arrangement. This is a program that was implemented by the government in order for people to pay their debts and for the creditors to get the money they are owed. An insolvency professional consults with the person owing the debt to figure out a reasonable amount they can afford depending on what is left from their cost of living expenses and then presents the amount to the creditors. The creditors then consult with the insolvency professional until a happy medium is found in which both debtor and creditor can positively benefit.
The standard conditions for an IVA in the UK vary depending on the company. Standard conditions are a standard part of an IVA that is presented to each individual client/creditor. One main condition of an IVA is that it is managed in a way to ensure a maximum return to the creditor and still offer a debt solution to the person in debt. This makes it a winning situation for everyone involved. Both the creditor and the debtor are expected to uphold the final contract under the stated terms and conditions listed. If the debtor fails to uphold their part then the creditor can continue with any legal actions.
The IVA is a form of debt management that was implemented by and is backed by the government. With an individual voluntary arrangement a person can avoid having to file for bankruptcy which can be stressful and embarrassing. With this program the debtor and creditor use an insolvency professional to implement a contract that can help them come to an agreement in which both can be happy with. The debtor can finally be free of financial debt and usually within a five year period as long as they maintain the terms of their agreement.
Spencer Gordan is a finance consultant who is currently researching the benefits of an <a href=”http://www.blairendersby.co.uk/”>iva</a>.
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