In order to avail the IVA loan service you have to meet certain criteria as a borrower. You need to be in debt of at least £15,000 owed to three or more lenders. It is important that you should get best advice when the Individual Voluntary Agreement is chosen. Also the organisation offering this loan service should be professional and independent. It is very important as when you deal with an IVA practitioner, you are bound with an agreement for the time period of five years. So you should carefully understand various facts and clauses of the IVA loan deal before choosing.
The IVA loan service offers the much required respite for a debt ridden borrower. It allows you to make a formal proposal to pay your demanding lenders a significant percentage of your debt over a period of time with easy monthly repayments and after the set period of time you would be free from the debt burden. An Individual Voluntary Agreement enables individuals facing severe debt problems arrive at a legal binding settlement with the demanding creditors with the guidance of an Insolvency Practitioner (IP). If the proposal is approved by majority of the creditors (75% of your lenders) then this agreement comes into being and binds all the parties (your lenders and you) and prevents any further action like repossession.
The rise in the number of people seeking to set up IVA loan service suggests that it is widely viewed as a good alternative to total collapse of financial health like bankruptcy. Indeed, of the 70,000 insolvencies were filed in the year 2007 and out of which one third were IVAs. This agreement allows people in serious debt to come to a formal debt re-payment arrangement with their creditors rather than having to face bankruptcy.
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