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What is an IVA?
Individual voluntary arrangements are necessary in an age where debt is needed to establish high credit scores and people are losing their jobs left and right. Individual voluntary arrangements are an alternative to the credit destroying bankruptcy claims. While there are many more qualifications needed to apply for an IVA there are various advantages that can be exploited.
In an individual voluntary arrangement there is a private written contract drawn up between the creditor and the borrower. Because of this there is a secure fixed interest rate on the loan and the debtor only has to pay back 30% of their debt. This aspect of individual voluntary arrangements saves a person who is in financial disarray quickly and effectively. Also the borrower is able to keep their house, car, TV, etc. because they are making payments. The payments are smaller and come to a lesser amount, but the debtor can still keep their property. And because at least 30% of the debt is paid back the debtor is not looked down on as much as with bankruptcy. If one is involved in an individual voluntary arrangement it is much easier to receive a loan then someone who has filed for bankruptcy. Also, like bankruptcy, the creditors can no longer bother the debtors. However these perks do not come easy.
Of course to qualify for an individual voluntary arrangement one has to be in a certain financial situation and has to maintain a steady income. One must be able to provide pay stubs or some sort of evidence proving their steady income to qualify for the individual voluntary arrangement. It is also the borrower's responsibility to find three sources that are willing to provide a loan that will satisfy at least 30% of their debt. This loan cannot be from simply one bank, but must be from three different sources. The debtor must also hire a practitioner because without them proper payments and pricing would not be implemented.
Individual voluntary arrangements give ease and relaxation to hard working people who need help. They are able to pay off their debt in around five years. This is a comfortable amount of time to pay any debt especially one that is 30% of its' original. After the 30% is paid off there is no more harassment from creditors and all surcharges are usually waived.
It is important to research all companies that provide individual voluntary arrangements. One must research the company's rules, regulations, and laws, and make sure the company provides the service of figuring out if the debtor actually qualifies. A debtor must know everything possible about their situation and about the proper channels they must go to be financially stable once again.