Is and IVA Worth Considering?

I recently came across the News Letter by The Bankruptcy Association. It was interesting to read the following passage about IVA’s:

“I have noticed in particular that most debt collection companies and agents are quick off the mark in offering reduced settlements for debtors who default on debt payments.

All this I hope has been to the better good of humanity. However, if that is the good news, whole new batches of financial sharks have entered the UK debt arena peddling junk IVA’s and other unhelpful debt solutions. Big business interests have moved into the death industry after spotting they could create a market from false hopes and promises to provide sensible debt solutions.

Insolvency Practitioner on IVA’s

These people are interested in making money and lack any moral values whatsoever. One insolvency practitioner told me that if some people were so stupid as to fall for the IVA procedure (individual voluntary arrangement) then they deserve all they got.

IVA’s Are Very Profitable

This is typical of the attitude of an industry that spends a fortune trying to flog IVA’s because they are so profitable. This industry then even has the nerve to order themselves insolvency industry prizes for their achievements in flogging these schemes………….”

I have always been amazed at how much these IVA companies charge for their services. Only the other day I was approached by an IVA company asking if they could advertise on my site. They were offering something in the region of £400 per client that signed up to an IVA! So if they can afford to give me £4oo, you then have to ask how much they are getting from putting someone through an IVA?

Searching for an IVA

Just as an experiment, search Google for an IVA, then look how many companies are listed on page one of Google. The top few are companies that are paying Google to be top of the page. Then you have others just below, fighting for position to be on page one! Now to be on page one of Google is not easy. Hell, very few pages of my site even get to near the top of page two? So once again, good sums of money is being paid out for sites to be listed on page one. So where is this money coming from? As IVA’s are such a lucrative source of income, you can be sure that past clients have helped to fund this.

How Do I Know if I Will Be Accepted for an IVA?

From your point of view, you are skint, really skint, there is no money left for anything and even card payments are falling behind. So from your point of view there is no money for anything! Prior to being accepted for the IVA, the company will do a full financial fact find on your current situation. First of all, they will have trigger figures that need to be satisfied to make it worthwhile for the company considering putting you into an IVA. Yep, they are not a charity, but the fees they charge may well fill their company coffers more than you can imagine. Any assets that you may have, will not be protected from and IVA. If they do say that your property is excluded, or any other things, make sure that you have that in writing.

Is My Property at Risk in an IVA?

I personally have been dealing with debt for a number of years, to date I have never recommended to someone that they enter into an IVA. To me an IVA seems like an over extended bankruptcy, also if you own a property that too is very much at risk when you enter into an IVA. If an IVA fails (they appear to have a very high failure rate) you can still be made bankrupt.

If you are thinking of going into an IVA get as much advice as possible, and also establish if your property is at risk. If you are currently in an IVA get advice to see if there is a better alternative.

Short Term Debt Management Plan is Best

Look into all the debt options that are available out there! If you need time to think a short term Debt Management Plan (DMP) may be useful. It may not be a solution, but it will give you time to think.
Just get as much advice as you can.

Further Reading

I would suggest that you read through the information shown on the the Useful Information tab.