For the thousands of people throughout England and Wales who are facing over £10,000 of debt to multiple creditors, an IVA is a fantastic method for wrestling back control of your finances from creditors. The process is incredibly simple, and debt free life will do all of the heavy lifting; we only need a little bit of information from you to get on your way.
In this blog, we will outline three reasons why you should consider entering into an IVA today, and why they are one of the very best methods for defeating debt and making a financial fresh start.
Reduce and Simply Debt Repayments
In order to qualify for an IVA, you have to owe thousands of pounds in debt to multiple different creditors. This means that you will be keeping track of a huge number of bills which is no easy task. You will likely also be in a position where you cannot possibly manage to pay back what you owe every month.
This combination means that you will likely miss payments, and even when you don’t, you might not be able to pay enough to match the minimum repayments. This means you will regularly be hit with interest fees and various other charges month after month, which means no matter how much you manage to pay off your debt is likely to increase still.
When you sign up for an IVA, we will work out a budget for you. This will take into account your income and your necessary expenses. Our advisers at debt free life will calculate exactly how much you can afford to pay each month, meaning you know you will always have enough money to live on while still making significant progress on your debt!
In addition, you will no longer have to worry about whom you owe money to and how much you should be paying. Instead, you will deliver your monthly repayment to us, as your insolvency practitioner, and we will distribute it appropriately between your creditors.
As you can see, not only will you be paying less, but you will just be making one payment.
An IVA and Writing off Debt
By far the most beneficial feature of an IVA is its ability to write off debt, meaning you can avoid paying off part of your debt entirely with no questions asked. As we just mentioned, with an IVA you only have to pay what you can afford, and it has to be just enough to satisfy creditors. At debt free life, we are on your side; we will always make sure you don’t pay a penny more than you have to.
However, an IVA is also fixed-term. This means that after a set period of time (usually about five or six years), the debt solution will end and any debt which has yet to be paid will be written off entirely. In other words, you can avoid paying back thousands of pounds in total.
In addition, because the agreement is legally binding, creditors have to accept this once the arrangement has been put in place. Once the solution has come to an end, it is illegal for creditors to try and get any more money from you.
Protect Yourself from Creditors
Owing money is undoubtedly the most serious part of being in debt, but perhaps the most distressing thing is constant creditor harassment. The endless pile of letters building up in drawers and the continuous ring of the telephone from people chasing you for money can lead to intense anxiety and even mental health issues. Entering into an IVA will make all of that go away.
When you enter into a formal solution (like an IVA, Trust Deed, Bankruptcy, and Sequestration), your creditors must stop trying to get into contact you for any reason. They cannot call you, and they cannot send letters; they are not allowed to get in touch with you about your debt for any reason.
Instead, your creditors will have to contact us. Your advisers will read all of the correspondence and can relay anything of importance to you upon your annual review. However, it is unlikely there will be anything you need to know so long as you have kept to the terms of the agreement and delivered your monthly contribution.
It is worth noting, that if you do receive a couple of letters or phone calls after entering an IVA, it may merely be a mistake. Perhaps they were already scheduled, or the right people in the creditor’s office haven’t been informed about your new situation. Just get in touch with your debt free life adviser, and we will get everything sorted out in no time.
Would an IVA Work for You?
If you are in a situation where you are facing unmanageable debt, the first step towards financial recovery is to get in touch with debt free life. We are an experienced and considerate insolvency practitioner and debt advice company which helps over six thousand people every single year to fight back and beat their creditors.
We know that debt is complicated, and we can’t all be experts, but luckily, we are! Our big team of friendly and knowledgeable advisers are ready to analyse your entire situation for you and work out the best path for you to move forward and get your finances back on track.
To get started on your journey towards a debt free life today, give us a call on 0800 808 5124 for free, impartial, and zero-obligation advice today.
Alternatively, take a moment to fill in our debt calculator, and one of our advisers will phone you at a time which suits you in order to discuss how we can help.