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The tough economic times being experienced here in the UK and around the world have taken a huge toll on the financial capacity of many UK families. Most people’s living standards have gone down, due to lower incomes and higher expenditure. Many borrowers are unable to keep up with their debt repayment obligations and many are on the verge of defaulting on their loans.
The UK has some debt solutions available to UK residents, regarding debt problems. One of the most important of these debt solutions is an IVA agreement. IVA stands for Individual Voluntary agreement. This is a legal provision that is part of the UK’s insolvency Act of 1986. IVA help is available to all UK residents faced with debt problems.
The law provides that any individual or business faced with heavy debts and is unable to make payments as required, can apply for this agreement. To qualify for this agreement, an individual must owe at least 15000 pounds to more than one creditor. The person should also demonstrate financial hardship. This is conducted by financial advisers who help individuals prepare the agreement. Other considerations when defining the agreement will include the assets owned by the individual as well as the amount of income they make and the amount they need to meet their living expenses, such as food, rent, clothing and transport.
Once an agreement has been drafted, it has to be approved by all the creditors, and then signed by an insolvency practitioner. When the agreement finally comes into force, it stops creditors from imposing any penalty fees or interest charges on the loan. The creditors are also stopped from directly contacting the borrower. If they wish to do so, the may contact him only through the insolvency practitioner. This puts to an end all those phone calls from creditors demanding payment of their debts.
IVA help allows UK holders of debt facing trouble with repayments an opportunity to repay their debts affordably and have the debts written off eventually.