What is an IVA?

Increasingly the IVA or Individual Voluntary Arrangement is seen as a much more acceptable solution to the last resort of bankruptcy for the resolution of debt problems.

Put in simple terms, an IVA is an agreement whereby a debtor repays a negotiated percentage of outstanding debt over a designated period, often up to 5 years.

But the setting up of IVAs is a very complex process, involving as it does the full collation of every detail of the debt situation. This also includes gathering evidence in order to draft the IVA proposal and then sending it out to creditors who must agree to accept the terms and conditions offered.

UK Credit, with its vast experience in debt management, is able to provide this essential service by negotiating the very best repayment terms possible.

Debt IVA

The overall aim of the IVA is to produce an agreement based on the amount the debtor is realistically able to afford to repay over the period agreed. Often negotiation over the terms of the IVA can actually reduce the amount of the debt itself, sometimes by up to 75%. But before the IVA can be implemented, the terms offered must be acceptable to all outstanding creditors. It is a process requiring great skill and a vast amount of financial and legal knowledge. UK Credit possesses all these essential qualifications.

Advantages of an IVA

On approval an IVA will generally be operative for a period of 5 years. The funds received will meanwhile accumulate into an account, which will then be passed on directly to the creditor or creditors.

Another beneficial feature of this form of debt IVA resolution, is that during the life of the agreement creditors agree to freeze the interest rate already on the debt. They are also unable to make further demands for debt restitution or undertake legal action in pursuance of the debt.

Throughout the process UK Credit will continue to update its customers with regard to any ongoing negotiations, and offer any further IVA advice necessary.

However, one of the greatest advantages of this method of debt consolidation is that customers are able to distance themselves, not only from the debt, but from the actual debtors so there will be no further risk of confrontation. UK Credit will deal with every further eventuality.

The repayment amounts are based strictly on the amount the debtor can realistically afford, but will always be significantly less than was previously being paid. There would be no point in setting up the IVA otherwise.

Once the agreement has been formulated and accepted, there is nothing further for the customer to do, but continue to repay the funds on the basis already agreed. UK Credit will take on the responsibility for any other requirements.