A creditor’s meeting is held to decide on the IVA proposal. An IVA actually benefits the creditors more as they receive a higher return than they would have got if the debtor had filed for bankruptcy instead.

Because of the increase in the number of people suffering from financial difficulties in the UK, more financial institutions offer IVAs. Specialist organisations usually host websites where you are able to log in to check the terms and conditions of an IVA.

There are numerous advantages of applying for an IVA over filing for bankruptcy. These advantages include:

• In some cases, you may apply for an IVA even if you have already filed for bankruptcy. Your financial organisation will be able to tell you if you fall into this category
• An IVA is personal. No one has to know you have applied for an IVA, and it does not appear in the local newspaper
• In some cases, you can still qualify for credit after entering into an IVA
• An IVA is not as expensive as filing for bankruptcy
• When you have applied for an IVA, the harassing phone calls, emails and correspondence from creditors will cease. They will also no longer have the ability to take any enforcement action against you
• The biggest advantage of an IVA is that you are not required to give away any of your property to your creditors. Also, you may use the equity of your property. However, there is one condition. Your IVA supervisor can register in the land registry so that the property may not be sold or remortgage without his consent.

However, so much of the modern world relies on the availability of credit; be it in the form of an overdraft at the bank, the mortgage on your home, the hire-purchase agreement on your washing machine or your credit card, and it can be tempting to fight debt by getting yourself into further debt in the hope of consolidation these into one smaller payment. The key to the control of your personal finance could be in the professional management of these credit streams and you don’t need a debt consolidation loan to do this.

Help with this is available from a number of outlets, you have the option of talking to a specialist debt advisor at Harrington Brooks, which is one of the longest established financial practices in the UK. Their online Debt Wizard can give you an outline of the debt solutions that would best suit your financial circumstances. Obviously, no two people will be facing exactly the same economic situation. They will be able to offer you insights into a personal debt solution that will hopefully help you to avoid bankruptcy.

The Individual Voluntary Arrangement, or IVA, is proving to be a popular alternative to a declaration of insolvency. This is a formal agreement between you and your creditors and it was first set out in the 1986 Insolvency Act. Its popularity has increased significantly in recent years though, as individuals have started to recognise it as a viable and attractive alternative to bankruptcy. The procedure is handled by an Insolvency Practitioner who brokers an agreement between you and your creditors. It hinges on 75% of your creditors (in terms of debt value) agreeing to a repayment schedule that will have you pay off a proportion of your total debt over a given period, usually 60 months. After this time, any remaining debt is written off. The percentage afforded to your creditors is determined by the amount that you owe to each of them.

An Individual Voluntary Arrangement has a number of key benefits over a declaration of bankruptcy. Firstly, it allows you to avoid the stigma associated with bankruptcy as it is not publicised in newspapers. Also, although you may have to relinquish some of the equity in your home, you will be able to hang on to it. For further information, please contact Harrington Brooks who will see if you qualify for an IVA which can help manage personal loan debts, outstanding credit card balances and other forms of unsecured debt amounting to over £12,000.

• IVAs are legally binding and must therefore be drawn up by a licensed insolvency practitioner and presented to creditors on behalf of the individual in debt.

• The result is that your creditors receive somewhere between 10p and 50p out of every pound that you owe. This depends upon the amount that you are able to repay and the value of any assets that you have at your disposal. When an agreement is reached, your creditors cannot add any further interest or charges.

• An IVA rests on a minimum of three quarters of your creditors (in terms of debt value) agreeing to the arrangement as such a high proportion of your debt can be written off. An IVA usually includes any unsecured debt, like outstanding credit card debt and your overdraft.

• An IVA is likely to take any equity in your house into account. In the vast majority of cases, your home will be safe from repossession but you may have to release some of the equity in your property to service the IVA.

• IVA’s are typically suited for those with a minimum of £15,000 of unsecured debt. They are a more attractive proposition than filing for bankruptcy as in the majority of cases, you can keep your home, the details of your IVA are not published and you retain a greater degree of control over your finances. Also, you are afforded greater freedom to conduct your business affairs.

To see if an IVA is the right debt solution to suit your circumstances, take the 15 second debt wizard at Harrington Brooks. You simply have to fill in a few details to see if you can reduce your monthly debt repayment and be debt free within just 60 months with an IVA.

Well, there is nothing to be proud of in passing our latest four minute milestone. There is a declaration of insolvency every 3 minutes and 58 seconds. That’s some record; a first in British financial history. This translates to about 11,000 people being declared bankrupt or going into an IVA in the United Kingdom each month.

In the wake of global recession this perhaps doesn’t come as much of a surprise. Rates of insolvency, both bankruptcy and sequestration, have been rising gradually for a couple of years and there was an element of inevitability about the findings but this doesn’t stop it making for distressing reading. Particularly when we count the associated costs of bankruptcy and become aware of the alternatives. Bankruptcy is such a severe debt solution and borrowers should be conscious of the other options at their disposal.

Primarily, an Individual Voluntary Arrangement, or IVA, is a preferred method of tackling debt. Whereas a bankruptcy will tend to result in the loss of assets like your home, the IVA process will let you keep your house, even though it might be necessary to relinquish a proportion of the equity. This isn’t the only benefit that an IVA has over bankruptcy. Where bankruptcy is a matter of public record, published in your local newspaper, it’s possible to keep an IVA far more private. It will still be published on the Insolvency Service website but it won’t be in any newspapers.

The Individual Voluntary Arrangement came into being as part of the 1986 Insolvency Act and has recently become increasingly more popular as an alternative bankruptcy. Of course, any debt solution should be carefully researched to ensure that you are taking on the right option to suit your circumstances. The Harrington Brooks Debt Wizard is an excellent free resource in ascertaining the right course of action. In 15 seconds, it can give you an accurate breakdown of the alternatives to bankruptcy. Now, that’s a timeframe that you can be proud of.

The key is to get advice that is specific to your financial circumstances. For example, if you don’t own any assets and are unemployed, then bankruptcy could be an option. If you are a professional, it might cost you your job though. A specialist debt advisor will be able to offer you assistance in making the right call. Take the free, 15 second debt wizard on the Harrington Brooks website and get impartial advice on the best course of debt help.

There are a number of points of distinction that are important to the individual involved when trying to decide between bankruptcy or an Individual Voluntary Arrangement. There are a number of points which make an IVA preferable to a declaration of bankruptcy. The primary attraction of an IVA over bankruptcy is the risk to your assets. The chances are, if you own your property, insolvency proceedings will put your home in serious danger of repossession. An IVA allows you to keep your house but it may require you to give up some of the equity you have in it to service your debt.

Further to this, the bankruptcy procedure is a public matter and there is a legal obligation to publicise the results of any insolvency in the local press. Also, you have an obligation to ensure that banks and other interested parties are made aware of it too. IVA’s are more private, only being published on the Insolvency Service’s website.

Naturally, setting up an IVA hinges on you having the ability to service some proportion of your debt. In order for three quarters of your creditors, the minimum proportion required to attain an IVA, to accept the terms of the agreement, you will have to demonstrate your ability to meet the repayment schedule. This creditor percentage is determined by value of debt rather than head-count. This means that if one creditor is owed 30% of your total debt, they have the power to veto the arrangement. Creditors can put forward changes to the proposal but there is no obligation to accept these. Interest rates will be frozen and your creditors will be forbidden from making additional charges.