Essentials of iva advice explained
Individual voluntary agreement was introduced as part of insolvency Act introduced in the year 1986. The aim of this law was to provide an alternative solution to people who are facing bankruptcy problems. An iva advice supports the interests of the debtor as well as the creditor. iva is a legal contract between the debtor and the creditor that enables the debtor to pay only a certain percentage of the debt and become free from the debt trap. The loan interest is frozen in this system so that it does not grow further.
The eligibility for an IVA is depended on many matters like one’s financial conditions and personal circumstances. Residents of England, Wales and Northern Ireland are eligible for iva advice scheme no matter even if they are presently residing outside. But persons who are residents of Scotland or outside United Kingdom are not considered for iva’s benefits.
iva advice is set up only if the total unsecured debts exceed £ 15,000. iva is an expensive arrangement and therefore this cannot be arranged for smaller debt amounts.
Another condition is that the debtor should be able to give at least 30 % dividend to his debtors. Iva that offers less than 30 % of what is due to creditors is not accepted by them.
iva’s benefits will be available to a person who is insolvent which means he does not possesses any movable or immovable property.
Another condition for getting iva adviceis that the debtor should be having debts with three different banks or creditors. A person who have three accounts in the same bank or who owes debts to the same person borrowed from him on three different occasions for three different purposes will not be eligible for iva's benefits.
This facility will be available to persons who have a regular income, which should not go beyond a minimum of £ 200. This is necessary to show that you can pay a monthly sum towards debt repayment for the next 60 months.
The IVA team will verify whether you qualify for the IVA agreement based on the above criteria and if you are eligible, they will inform whether you qualify for the scheme or not. Fortunately,not all these criteria are rigid and debtors can make changes and give exemption to certain conditions wherever they find it necessary. If you do not qualify for IVA settlement, they may request you to try some other methods like debt counseling or debt management.
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