iva

[sunflower68]

What is the general idea of these?  My friend undertook what I believe is an Independant Voluntary Arrangement, not quite as tricky as a bankrupcy.  It still means he has terrible credit for approx 5 years. When can he see himself clear of the financial stresses that brought him to this?

[Oneeyedvic]

Hopefullt hthis will help you:

http://www.insolvencyhelpline.co.uk/paye-employed/the-iv a-procedure.htm

With regards whow long it will take - well it will mean that he will not be able to take any credit out in the near future, and as it is a matter of public record, it will show up on credit searches.

The financial stresses it brought him should be alleviated now, as he should have come to an arrangement with all his creditors and they cannot legally chase him or add any further interest so long as he keeps up his payments.

[Didwot]

Voluntary Arrangements were introduced by the Insolvency Act 1986 as a way of enabling a debtor to avoid bankruptcy and to come to an arrangement that would be binding on all his creditors, even if a small minority did not agree with the proposal. It is meant to be something less dreadful than bankruptcy. Unfortunately certain creditors, particulary the VAT and Tax people and also some of the major banks made progressively more and more penal demands as to what should be in the arrangement, in extreme cases requiring the debtor to hand over all his capital and then make payments out of income until all the debts and interest and costs had been paid, often over 5 or more years. As they were often the major creditor they were able to force their requirements on the debtor who was then in a far worse position than if he had simply gone bankrupt (as he should have been advised to). IVAs have therefore not been the great success that was hoped, and with the period of bankruptcy being reduced to 1 year by the Enterprise Act it will be a rare occasion when a debtor is better off in an IVA than going bankrupt.

[borg123]

i agree with mdoo98----me and my wife entered into an iva 3 years ago after i was made redundant--we first went with a company that promised to help us for a set monthly fee of �79.00 and the only thing they managed was to destoy our credit record--(i will not mention who they are but they are well known on tv adverts etc).

we had debts in excess of �65000 so the iva was a great help---but after about a year of paying we sold our house and with the equity and  endownment we  contacted our iva representive who then contacted our creditors and they all shared out the proceeds.

we now live in rented property with our kids ----all our past luxury's gone but a hard lesson earned.

we both still work but our health has taken a battering over the last 3 years due to stress etc.

i say if you are in debt and struggling --approach your creditors first they are usually happy to help.

you can still get a mortgage and a bank account after but i think certain company's wont.

the stigma of being a failure at your finances amongst family  members  hit us the hardest.