What are my other options?
An Individual Voluntary Arrangement is a legal binding agreement between you and your creditors. It lets you pay off your debt at a fixed monthly amount based on your budget, usually over a period of 5 years. Interest and charges are frozen and the people you owe money to cannot make any further demands on you. Once your final payment is made, your remaining debt is legally written off leaving you totally debt free.
Bankruptcy is a big step. It's a step that people usually take as a last resort
as bankruptcy has serious implications for your future. For some people, however,
it may be an option that makes sense, or it may be the only option available to
them.
You may have seen adverts on the television for debt consolidation. This is the
debt solution where you swap lots of smaller, short term, high interest loans with
one bigger, longer term, lower interest loan. This can bring down your monthly
payments and simplify your financial affairs, but will often cost you a lot more
in the long run. However, if making ends meet right now is the issue this can be
the best solution.
Debt management is often the best solution for those people who have a short term
problem and who believe they will be able to do more to service their debt in a few
years time. It can also be used when an IVA is not possible, for example if someone
has been made redundant or is dependant on benefits.
Which debt solution is best for you? Find out now with our 60 second test.
What about debt consolidation?
What about debt management?
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