IVA -AN ADVANTAGE

Date: 2012.01.11 | Category: Finance | Tags:

IVA stands for Individual Voluntary Arrangement. It helps to avoid bankruptcy. In 1986 a law was passed in U.K. Unlike debt management, it is agreement with the creditors. Flexible terms can be made on an individual’s own circumstances. They can be based on a number of factors such as capital, third party payment and income. But also all these factors can come under one shed. The contractual arrangement should indeed be a planned process with the creditors. In Scotland there is a similar process to the IVA known as the Protected Trust Deed. In case of IVA, advice should be taken to decide on the best option.

There are many advantages in this procedure. First of all the agreement made between the debtor and the creditor is private. The financial matters are not disclosed in public. The length can have duration of five years; however they do not have a fixed period. The agreement could last as long as required for the debtors to pay back the debt. Using bankruptcy, IVA does not restrict the debtors from obtaining credit. It also provides a protection because all the insecure creditors are bounded by the contract. Sometimes the IVA fails because the individual could repay the debt through out.