Does this sound familiar?

You’re swamped by all your debts, and you can see no other way out but to file for bankruptcy. You must now say goodbye to all your belongings and hope that it will be enough to pay off all your debts. When that happens, you and your family will give up your home in the bankruptcy process. Are you in this situation right at this moment?

Before you jump to any sudden decisions, you have to make sure that bankruptcy is right for you. What you may not know is that you can possibly qualify for other programs designed to handle debt cases. To find out, you can consult someone who is qualified to give you valuable debt help. There are both paid debt help services and charity associations who can help you figure out what your options are.

Individual Voluntary Arrangements, or more commonly known as an IVA, are a superb alternative to filing for bankruptcy. It is a legally binding agreement between yourself and your creditors concerning the settlement of your debt, as overseen by someone acting on your behalf such as an Insolvency Practitioner (or IP for short). Your proposal must contain a workable payment scheme for your creditors after taking some points into consideration, such as your monthly income, living expenses, and other pertinent facts, which the majority of your creditors must approve of in order for the IVA to push through. The terms of this plan may undergo several changes as petitioned by any creditor before the final vote is called. Once all your creditors accept the offer, you must keep to them for the duration of the payment period.

Here are some advantages about IVAs that you should consider:

During the IVA proceedings, no lender on your list can take legal action against you without due permission from the court. But please take note that this only covers the creditors you listed down in your IVA petition, so be careful when making that list.

If you file for bankruptcy, everything you have will be taken into consideration and auctioned off, and the sale amount will go towards your debts. In an IVA, you won’t be at risk of losing the roof over your head.

Unlike bankruptcy, which is divulged on the newspapers, persons who opt for an IVA are only listed on the Personal Insolvency Register, which is duly noted by credit bureaus. While the fact that you have filed for an IVA is not kept hidden from the public, there is a feeling of being less subject to awful rumors.

Generally, it would reflect better on you if you show that you are willing to pay back what you owe. However, an IVA doesn’t guarantee that your credit scores won’t go down, and while it will reflect on your financial records, in most cases you can still avail yourself of credit. You and your creditors must agree on some sort of fixed reparation terms, lasting anytime from three to five years. It will be up to your designated representative to distribute this amount among your creditors.

Article Directory

Categories : Lora's Posts