IVA advisers help people manage their debts through a government scheme called Individual Voluntary Arrangement. This scheme enables people to spread their debts over a 5 year period and make manageable monthly payments towards the balance. For many people, this is the perfect solution to their money troubles, as they can relax knowing all of their debts are being dealt with. But how do you know when it’s time to speak to the IVA adviser? Below, we discuss some key indicators that mean you should go and inquire about an IVA, plus the eligibility criteria.
If your debt is higher than £10,000
While you can get an IVA with a lower amount of debt, if you owe above £10,000, you can almost certainly benefit from having one. If this is you, speak to an IVA adviser and they will assess your situation and discuss the best way to move forwards. If there are cheaper debt solutions available to you, the adviser will inform you of these, too.
If you have a regular stream of income
IVAs require you to make a manageable monthly payment towards your debts, so it’s essential to have a regular income stream to keep up with the payments. As an IVA is a legally binding agreement, missing payment can have consequences and can also negatively impact your credit score. You need to have approximately £80 spare income available each month to get an IVA. If this sounds like you, you should probably look into IVAs.
You have multiple creditors
If you have three or more creditors, this is probably a sign that you should speak to the IVA advisor. Having multiple creditors is one of the requirements of an IVA, as it involves consolidating multiple debts and addressing them all simultaneously. If you only have one or two creditors, you may be able to benefit from a different debt management solution.
You’re struggling to make your monthly payments
The primary indicator that you need to speak to an IVA adviser is that you are struggling with your debts and need some help. This is a debt solution backed by the government and is designed to lift people out of debt and get creditors repaid, as this benefits everyone involved.
IVAs are set up so that all of your debts are compiled in one place by an insolvency practitioner. They then evaluate your financial standing to determine what you can afford to repay each month. The amount you pay will be significantly lower than what you are currently paying, and this amount is divided between your creditors.
The best part is, once the agreement reaches its end, you may be forgiven for up to 90% of your debt! Meaning this much could be completely written off.
How can I get an IVA?
If this debt solution sounds like something that might benefit you, reach out to us today and we can help you get started.