One in six UK adults have problems with debt. It’s not so strange if you are in over your head with debt over £6k but it is possible to work around a solution that you can afford to pay. In the process, you can stay in business, you won’t lose your property with enough for equity and your creditors can get more money than if you’d declare bankruptcy.
A Better Alternative to Filing for Bankruptcy
Often, bankruptcy is seen as a last resort to solve problems with debt. It’s because in bankruptcy, you have to liquidate all of your assets and can lose valuable assets you own including your car or house. Add to that the burden of still having to pay monthly payments towards your debt for up to 3 years.
With an IVA (Individual Voluntary Arrangement), a licensed insolvency practitioner (IP) will be able to help you:
- Lower your Monthly Payments and Freeze Interest and Fees
- Write off debts you aren’t capable of paying
- Mediate between you and your creditors to stop the pressure
To qualify, you only need to have a minimum of £5k of qualifying unsecured debt from at least 2 creditors. It is also wise to note that Creditfix IVA Advice could only be obtained if you are a resident in Northern Ireland, Wales or England where governing laws exist.
Have Someone Mediate Between You and Your Creditors
Your IP should be able to set up and supervise your IVA whether you’re employed or self-employed. Note that it is impossible to go through with an IVA without an IP. The law even mandates that you should keep your IP up-to-date on your financial status every month and submit an annual report so your monthly payments can be reduced or increased accordingly.
Benefits for Creditors and Debtors
Creditors benefit from an IVA as well as the one in debt as this ensures a larger repayment compared to bankruptcy. From the beginning, a realistic amount is agreed upon to be paid in monthly installments divided among your unsecured creditors. The payments last 5 years unless you are able to increase monthly payments to shorten this period. Also, all fees and interest are frozen during this time. By the end of the IVA, any balance is written off.
Creditfix IVA can assist employed and self-employed individuals to avoid bankruptcy and please their creditors enough for them to stop the calls and mails. It helps reduce your debt to a realistic amount and ensures your creditors, they get more in the long run than through filing bankruptcy. There are cases when up to 75% of the debt can be written off, your career won’t suffer as much because you won’t be forced to resign from your position and you will be able to remain in business and focus on stabilizing and maintaining your profitability and revenues.
UK Companies are Debt-Reliant
Studies show that UK companies are often undercapitalised and rely too much on debt. However, when debt becomes too overwhelming and so does creditor pressure, it should be time to stop and think how you should solve your debt problems. Before you think of plunging into bankruptcy, you may consider getting Creditfix IVA Advice first. Laws in England, Wales and Northern Ireland have made it possible to stay in business, pay your creditors a realistic amount you can afford and allow profitability once more, being debt-free after 5 years, the most.