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Debt Management through IVA

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Managing your finances effectively is an invaluable life skill, keeping us in control of our money and not falling into the all too easy trap of debt. Many of us have experienced the feeling of loss of control that accompanies spiralling debt, and the accompanying anxiety associated with it. If you do find yourself in this unenviable position, its always best to seek professional help. Unburdening yourself via the help of a professional can be very relieving.

Debt Support Service is available for you, providing fair and ethical consumer debt management. We expertise in helping people who are struggling with personal debt and financial problems, and are perfectly placed to help you find the right solution for your individual circumstance.

Debt management is a process designed to reduce and eventually clear you “unsecured debt” without the need to take out another loan, or risk collaterals such as your property or vehicle. Essentially it is an unofficial agreement with your creditors for the repayment of unsecured debt over a set period of time. Once you have agreed and committed to the plan, you’ll be required to pay your regular instalments to the debt management company.

Importance of debt management

  • Firstly is the protection and wellbeing of your family. Unmanaged debt and the stress it can puts under, has the real potential of damaging our relationships to those around us, in some cases tragically leading to the breakup of the family unit, with the potential of children being adversely effected from the resulting fallout. Seeking debt management help at the earliest possible opportunity stands us in good stead to avoid the worst outcomes of uncontrollable debt.
  • Secondly, debt management can help your physical health. Rising debts can lead to stress, insomnia, heart problems and exacerbate many other existing conditions. Taking professional help to manage your debt at the earliest opportunity will help to avoid any negative impact on personal health.
  • Thirdly, bad debt management costs you money. By reducing fees and high interest rates you’re directly saving yourself money and shortening the time you are indebted. Think of how you and your family could benefit from the money saved.

There are various options out there to help manage your debt issues. Of these, an Individual Voluntary Arrangement (IVA), is best suited to individuals looking for a formal alternative to bankruptcy.

What is Individual Voluntary Arrangement?

Individual Voluntary Arrangement (IVA) is a formal and legally binding agreement between you and your creditors to help you pay off your debts over a given period of time. It is approved by the court and your creditors have to abide by it.

How does an IVA work?

An IVA is arranged by an insolvency practitioner, they will typically be either a lawyer or an accountant. Based on the financial details provided by you (your debts, assets, income etc), an insolvency practitioner will propose a monthly figure that you’ll be required to pay and the duration that the arranged IVA will last. Creation of an IVA is successful if creditors holding 75% of your current debts agree to this arrangement. You will then enter into a legally binding arrangement, that any remaining creditors must also adhere to. An IVA will prevent your creditors from taking any action against you in the future, as long as you conform to the terms of your IVA.

Do I qualify for an IVA?

These are the qualifying IVA criteria:

  • Have a minimum of £80 of spare income each month that can be used to pay your debtor.
  • Have a minimum of two different debts.
  • Have the ability to back a minimum of 5p for every £1 debt owed to your creditors.

Note that these are guidelines and each case will be assessed individually.

How much does an IVA cost?

The Insolvency Practitioner plays the role of the nominee and supervisor throughout the period of the IVA and both these services have an associated cost. These costs in detail are:

Nominee fee – a fee charged by the Insolvency Practitioner who proposed the IVA plan to your creditors.

Supervisor fee – after paying the nominee fee, any remaining funds would be used to pay a supervisor fee.

Disbursements – these are additional costs incurred during an IVA that are paid to third parties, such as insurance, registration fee, maintenance fees etc.

At Debt Support Service, we offer comprehensive debt management through fully trained and skilled advisers with an extensive track record in the industry. We can work with you to efficiently resolve your debt problems, reducing your anxiety and relieving you of your financial worries.

Debt Management through IVA

Debt Management Plan – Making the Right Move

By | Food for thought

The demand for a debt management plan, the UK has seen a rise in recent years. The economy across the globe has taken an adverse turn. As a result, most of the consumers have to
manage both their expenses and loans at the same time. Based on the latest poll conducted by money.co.uk, over 50% of the UK consumers have entered 2020 in debt, with nearly five million
owing over £10,000 in loans and credit. As per the poll, people set aside on an average, nearly a quarter of their monthly salaries to pay off their debt. On an average, above four million people
have around £10,000 to £50,000 of personal debt. In case of redundancy, especially considering the economic slowdown, a debt of such magnitude will be too burdensome.

Does credit card bills dominate a major part of your mails? Is the incessant ringing of your mobile phone to remind you of your overdue bills bothering you? If the answer to them is yes,
you should probably consider your options to get a prompt relief, which might include a debt management plan, UK. A debt management plan within the UK is one way to solve your credit
problems and pay back your debt. Individuals who not only need advice but also a well laid out repayment plan to get them out of their debt can benefit from a debt management plan, UK.

A debt management plan UK is a debt management help that you enrol in, where a company liaises with the creditors on your behalf to work on agreeing with a reduced interest rate and
new monthly payments. Usually, the debt management plan is arranged in a manner that it should last to a maximum of five years with the aim of paying off consumer debt.

Get in touch with a debt management help provider like Debt Support Service today to get yourself a debt management plan, UK. At Debt Support Service we contact your creditors and
negotiate a repayment plan for you. The two main points to consider with regards to the benefits of a DMP are that it reduces the expense of your monthly dues and the negotiations with your
creditors are managed by a debt management help provider leaving you some breathing space. You can also close a Debt Management Plan early by paying off all your debts. This is done by
increasing your monthly payment or using a cash lump sum to settle the debts.

When you start a debt management plan, the monthly payment you give to the provider is calculated on the basic ground rule that you have sufficient money left over to provide for
essentials. This monthly payment is then allocated among the creditors in proportion to how much you owe them. The debt management help provider will take their fee from this monthly
payment. However, you may need to cut back on spending for a while so as to ensure you are taking one step closer to becoming debt-free.

How to Get an IVA

By | Food for thought

An Individual Voluntary Arrangement (or IVA for short) is a formal agreement drawn up by your creditors to help you manage debts. The usual approach is that your debt management company (DMC) will assign a licensed Insolvency Practitioner to work out the details with your creditors to establish what you can practically afford to cover. Due to this arrangement, you can expect to pay one reduced monthly fee and at the close of this IVA period (typically five or six years) the remaining unsecured debt will be written off. Incredibly, this can represent as much as 85{656fba9076fce85d9375a78485744480d9a16cad220bfa051b3a2faf0d56adbe} of your total debts.

Setting up an IVA is not a decision to be taken lightly though. If your creditors accept the proposal, it will be legally binding – so you should seek expert help and guidance before you make your final decision. The benefits of an IVA are more affordable repayments, the ability to stop creditors hassling you, legal protection from bailiffs, stopping attachment to earnings, the possibility of writing off remaining debts and eventually becoming debt free. During the IVA period your Insolvency Practitioner will review your finances on a yearly basis and provide an annual report.

Your debt management company will calculate the IVA payment by studying your income and expenses (without including any debt repayments) and figuring out how much spare cash you have left over each month. Be warned that while it can be a powerful solution to escape a surging debt load that you couldn’t otherwise settle, an IVA will also negatively impact your chances of taking out any credit in future. In other words, it will leave a negative mark on your credit rating – but fortunately this won’t be permanent.

A record of your IVA will be entered into the public Individual Insolvency Register (IIR) and will remain there until the arrangement is concluded. You should find that you can secure credit for living essentials or for purposes related to the wellbeing of your family; or If you are the owner of a company or are self-employed. However, since your credit rating will be much poorer than usual during the course of the IVA, you will probably find it much more difficult to take out any new credit. If successful, the interest charged is likely to be considerably higher.

If you’re hoping for credit totalling over £500 while the IVA is active, then you will need to seek written permission from the Insolvency Practitioner at your debt management company. The IVA itself will stay on your credit file for six years after the agreement started. Evidently, this is a serious step for under-pressure debtors who are looking for a comprehensive solution. It has worked for many of our clients. If you have any questions about the IVA system or want to further explore its suitability for your personal situation, please get in touch with Debt Support Service by phone: 0800 97 88 495 or email: info@debtsupportservice.co.uk today.

When It’s a Good Idea to Seek Help from a Debt Management Agency

By | Food for thought

One clear benefit of formulating a Debt Management Plan (DMP) with the assistance of a debt management agency is that you can expect continual support and advice from a carefully assembled team of specially trained debt counsellors. Of course, if you’re hoping for the boost of a relatively low interest rate and a consolidated payment, then a low interest consolidation loan may be just the ticket for you. However, most consumers struggling with debt feel that they require a bit of extra support to kill off their old habits and fully apply their new objectives. Also if you have missed payments recently it may also make a loan unobtainable. That’s why a DMP usually makes the most sense.

Any debtor with more credit card debt than they can easily manage can potentially benefit from a DMP-type arrangement. In most cases, it’s simply a question of reaching a decision as to whether or not the main advantages of a DMP meet your precise needs. If you suspect a DMP is the right course of action for your situation, begin by talking to a debt management agency. Remember, though, that there is almost no feasible repayment plan that will work if you lack any form of income whatsoever. When a debt management agency administers a DMP, they must ensure that the plan is genuinely affordable and can be integrated into a balanced budget.

If you are lacking the income necessary to cover the basics of day-to-day living (food, utilities and shelter), then debt repayment should not be your emphasis at this stage of the journey. A DMP may eventually work for you, but you’ll need to work on increasing your income first. Contact Debt Support Service today and we’ll figure out the correct solution for you.