Why have IVAs increased in popularity recently?

By Faisal Ahmed

An IVA, or Individual Voluntary Agreement, is an arrangement between you and your creditors which will assist you in making your debt repayments more manageable in order to pay a percentage of your debts. Typically, your debts are settled after a five year period. It is a method of solving debt which has become increasingly popular over recent years as it has been made more broadly known through the media.

It is believed that IVA companies increasing their media advertising in response to the debt crisis is the cause for an increase in the popularity of IVA. Newspapers, radio and TV. Those individuals whom were targeted by these advertising campaigns were those who fit the criteria of being at least 15,000 in debt. The government legislation wasn't broadly known before this mass advertising but that is no longer the case.

The public now know about the IVA and, of course, are attracted by the idea of having up to 75% of their debt written off. It used to be the case that IVAs were employed by individual businessmen or company directors who saw it as way of saving their business with the option of avoiding bankruptcy.

Companies which provide the IVA have grown which has helped to disseminate this option. However, there are some elements of it which do cause some concern. For instance, the advertising can make it seem like a magic formula and advice given by a commission-based salesperson may not be the most impartial. There may also be costs involved which are not made broadly known.

The problem with more people being aware of an IVA is the fact that they will be pushed into thinking it is the most viable option when, in fact, an alternative debt arrangement may be more suitable. It is always better to seek independent consultation beforehand to ensure that you get the full picture before rushing into anything.

About the Author:

Look into the benefits of IVA UK and you'll see why they have become a popular option for clearing debt.