What Effect Will An IVA Have On My Debts And Monthly Bills?

Many will rightly question what effect an IVA would have on debts and monthly bills in general. This is probably the most significant question to ask when finding the right solution for you.

Your eligibility is decided by how much you can afford to make affordable monthly payments. This can easily be done by using our online calculator. An IVA will bring together all of your debt payments so that it can make everything that little bit easier and more financially beneficial.

An Insolvency Practitioner will look at your proposal depending on income and expenditures, determining how much you can afford to pay each month. They will also take your combined bills and additional debts into consideration too.

If the debt providers you owe money to all agree with the proposal by your IP, then they’ll pay one payment each month towards your debt. This makes it a lot easier to pay your household bills on top of this one payment.

What Impact Will An IVA Have On My Reputation?

It might not be something you think about unless you tend to worry about what others would think about you being in debt. Your IVA is something that gets recorded on the Individual Insolvency Register. This register is made available to the public, so if someone were to search for your name, they would come across it.

However, the IIR isn’t something that sends out daily alerts to the press about people added to it. So unless someone is deliberately looking up your name, it is unlikely anyone would ever know you were in debt.

Most people don’t like talking about their finances anyway, so unless you’re an owner of a business, taking an IVA shouldn’t be something you avoid simply worrying about reputation.

Is It Possible To Lose Your Home With An IVA?

Your home is your livelihood, and when you own a property, the last thing you want is to worry about losing your home. If you’ve been considering an IVA, you may be wondering if it’s possible you could lose your home in the process.

Your property ownership status is taken into consideration when applying for an IVA. The assessor would look at the amount of equity you have already available in your property and would be available to you if you were to sell and pay off your mortgage.

You will be required to include your property in your IVA, which means that the share of equity you have in the home will be reviewed. However, you will never be required to sell your house to pay off your IVA.

Some Insolvency Practitioners might suggest you draw down some of the equity you have to pay off the IVA, but only if you have available equity. You need to have at least £5,000 in equity to use it for your IVA.

It’s worth speaking to your IP in more detail about this option of paying off your IVA as it might not always be applicable for you and your finances.

Can An IVA Have An Impact On My Job?

In most cases, your IVA won’t affect your job. However, it’s worth being aware that some types of employment can affect your position in the job due to an IVA. To avoid any risk to your employment, let your employer know about your considerations regarding an Individual Voluntary Arrangement.

For those in the fire service, police or prison service or you have a job in a financial position like an accountant, for example, then this could impact your job if you get an IVA. This won’t be an issue for self-employed individuals, but ongoing credit with suppliers might become a problem.

Is It Beneficial To Get An IVA?

Despite this being another debt solution and perhaps something that would worry many going into, there are benefits to an IVA. Here are just a few benefits you can gain from using these Individual Voluntary Arrangements.

• No pressure to pay what you’re unable to pay from lenders within the said agreement
• Any interest and charges are frozen
• You’ll never need to sell your home
• No upfront fees are required
• All unsecured debts can be paid off with this option
• Affordable payments are made each month.

Of course, it’s always good to get money advice to make an informed decision, but an IVA can be beneficial to many.

Can An IVA Destroy Your Life?

If you have a credit file that needs improving due to debt issues, then an IVA is a great option to help clear debt quickly. Many debt charities can offer debt advice, but if you’ve not looked at IVAs, then speaking to an Insolvency Practitioner is worthwhile.

Will an IVA affect your life negatively? As long as you make your payments on time and follow all guidelines, an IVA could be a step in the right direction.

Final Thoughts

Like any debt solution, it’s good to weigh the pros and cons. While an IVA certainly isn’t a negative option for most, some issues could arise if you’re not careful. Be sure to do your research, and remember, a professional at IVA Helpline is available to help.