The new debt solution - Individual Voluntary Arrangements (IVA)

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Program to Consolidate Your Debt
In the present climate of easy credit it is easy to get in over your head with credit card debt. Many people do not realize how many Americans are living payday to payday getting deeper and deeper into the drowning pool of high interest revolving debt. With recent laws mandating higher minimum monthly payments and stricter bankruptcy laws there are those who may feel they have no options. A progra... Read debt consolidation article



The new debt solution - Individual Voluntary Arrangements (IVA)
The UK is facing a debt crisis fuelled by over spending and over borrowing. In June of this year personal debt in the UK broke through the £1.1 trillion barrier and Britain's personal debt is reported to be rising by £1 million every 4 minutes.

The rise in the number of people seeking to set up Individual Voluntary Arrangements (IVA), the government's much touted alternative to bankruptcy, demonstrates both the extent of the problem and the perceived advantages of this new debt solution. But is the Individual Voluntary Arrangement (IVA) really all it's cracked up to be?

Until very recently when people were overwhelmed by debt, bankruptcy was the only solution. However, the introduction of the Individual Voluntary Arrangement (IVA) by the government has created a new alternative to bankruptcy which is beneficial for both the debtor and the creditor.

The idea behind the introduction of the Individual Voluntary Arrangement (IVA) was to enable people facing financial difficulties to come to a formal agreement with their creditors rather than having to face bankruptcy.

If an Individual Voluntary Arrangements (IVA) is agreed between the debtor and creditor:

* Interest on the loan is frozen * Legal proceedings are stopped * The overall debt is reduced

An Individual Voluntary Arrangement is generally seen as a more favorable option than bankruptcy from both the debtor's and creditor's perspective.

This is because there are no fees or legal proceeding involved with an IVA, unlike with bankruptcy and unlike bankruptcy an IVA doesn't have any stigmas of disqualifications associated with it. Furthermore, from the creditor's point of view, an Individual Voluntary Arrangement offers a greater repayment of the debt than would otherwise be achieved if the debtor were made bankrupt.

The only real disadvantages of an Individual Voluntary Arrangement (IVA) are that you can't borrow more money when an IVA is in place (but this is a good thing since more borrowing leads to more debt); an IVA tends to run longer than bankruptcy (usually for 5 years) and it is possible that you might have to release some of the equity in your home (or in another valuable asset) as part of the IVA agreement.

In conclusion, an Individual Voluntary Arrangement (IVA) can be an excellent way of getting to grips with your debt issues by allowing you to only repay what you can afford over an extended period of time whilst avoiding the stigmas and restrictions associated with bankruptcy.

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How a bad credit report will impact your life

A low credit rating or bad credit report can negatively affect virtually every aspect of your life. Whether you are consistently late on your mortgage or utility bills or you are over your limit on your credit cards, bad credit can make purchasing on credit virtually impossible, and it can limit your lifestyle in many different ways. Though over time you can recover from a bad report, there are still many aspects of your life that can suffer from poor financial management and low credit scores.

For instance, if you are planning to purchase a new or used car, it may be virtually impossible to secure a financing loan if you have a low credit report rating. Even if you can obtain a loan, you interest rate may be up to one hundred percent higher than it would if you had excellent credit. Rather than paying six or seven percent interest, you could end up with a fifteen or sixteen percent interest rate. Having bad credit can cost you thousands of dollars over the course of paying back your car loan. Not only will you not be able to get that new car you want, but you will also end up paying much more for the old car that you have to choose instead.

If you are interested in purchasing your own home, you will have to take out a mortgage. If you have perfect credit, you can secure a low interest rate of around five percent or even less. This will make your monthly payments rather low. However, if you have bad credit, you might only be able to secure a loan that charges nine or ten percent interest, making your monthly payments much higher, and costing your thousands upon thousands of dollars over time.

Credit card debt is one of the causes of poor credit, and it is also one of the ways poor credit can cost you the most. If you have several thousand dollars in credit card debt, and you are paying up to twenty percent in interest, it will be virtually impossible for you to ever pay off your debt within your lifetime. One the other hand, if you have excellent credit, you may be charged rates as low as eight percent, or possibly even lower still.

Poor credit report ratings can affect not only your loan and credit card situations, but they can also affect your car insurance premiums! Though it seems unfair, automobile insurance companies sometimes consider people with bad credit as high-risk drivers. Having poor credit can cost your hundreds of dollars per year in car insurance premiums.

If you are renter rather than a homeowner, some landlords and property management companies run credit checks before allowing you to rent from them. If your credit report shows a low score, you can be denied housing. If you do end up being able to rent, you might not be able to turn on utilities in your name, especially if you have been negligent in paying your bills in the past.

Bad credit report ratings can affect virtually every aspect of your life, from your car to your house to your insurance premiums. Because of this, it can certainly also affect your health. Financial worries are a leading cause of personal and relationship stress, and this stress can lead to mental and physical health problems. There are many consumer credit counseling services that can help you gain control of your finances and get you on the right track toward good credit. Many of these companies are non-profits with their sole purposes of existing being to help people get back their financial and mental health.

With many years experience in the lending industry, Sintilia Miecevole's site http://www.fixurcredit.com will inform you of everything from credit cards, scores, payments, repair, theft, approval and quotations to loans and financing. Be sure to visit http://www.fixurcredit.com to learn about all aspects of credit.


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The new debt solution - Individual Voluntary Arrangements (IVA)
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