Individual Voluntary Agreement or IVA for short is available for everyone who lives in England, Wales or Northern Ireland. People who are usually in debt try to see if they qualify to avail of this IVA. The IVA is a legally binding agreement between you and a creditor, whether it be a bank or credit card company.
In this agreement, what happens is that you propose to settle all your debts in a specific period. Usually, this period lasts about five years, and during this time all your debts are frozen. The great thing about choosing IVA over filing for bankruptcy is that you can keep your assets instead of having to give them up.
But take note that this is a serious matter and most people who settle for an IVA feel like they have no other choice. You need to consult with experts who can truly assist you with the process. Get IVA help from Creditflix to get you started.
Once you’ve started with the IVA, know that it is a commitment. Remember the tips below so that you can still live comfortably even with the responsibility of the IVA.
1. Understand that it is not a way to get out debt – some people want to get an IVA because they are enticed by all sorts of advertisements they see in the media. They would see companies promising to cut off their debts by as much as 75%. You need to take control and be responsible. You spent the money so you need to pay it back. Getting an IVA is not a way to erase your debt; it is there to help you manage your life and finances so you need to accept the responsibility.
2. Learn to live within your means – take note of your budget and make sure you prioritize what needs to be prioritized. Live within your means, and focus on the important and necessary things such as food and shelter. For luxuries, only indulge in them when you know that you have extra cash.
3. Make sure you are able to pay the agreed amount regularly – as this is a legally binding contract, you need to make sure that you are able to pay the agreed amount in your IVA. If it is unavoidable that you miss some payments, talk to the bank or company right away. Some allow up to two missed payments, but you need to inform them right away.
4. If there are changes in your finances, negotiate with your creditor – what if you find yourself changing jobs and earning less than before. Or maybe you have a new baby which has added to your budget? Make sure that you talk to your creditor right away as many are willing to make adjustments to your agreed amount to pay as long as you present a valid reason on why you can no longer pay the agreed amount.
5. Do not take out another credit card – just because you have the IVA does not mean that you can just get another credit card. Do not spend money you don’t have, or else you will find yourself in debt again. Know that not all debts can be placed under the IVA, so you need to control yourself and make sure that you are being financially responsible.
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