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IVAs allow consumers to "write off" some of debts
2 October 2007
An individual voluntary arrangement (IVA) allows debtors to "write off" some of what they owe as well as being able to "get their affairs in order", a financial expert has claimed.
IVAs allow the debtor to structure debt repayments over a five-year period by agreeing to pay their creditors a set amount over that time.
With rapidly increasing record personal debt levels, IVAs and insolvencies are becoming much more common among younger people, as the five-year limit allows some debt to be written off, rather than being put on the "back burner", R3 said.
Nick O`Reilly, vice president of R3, added: "Now an awful lot of people in their twenties are getting themselves into debt problems; have no real assets and the voluntary arrangement allows them the chance to at least get their affairs in order before such time as they perhaps need to get a mortgage and settle down."
R3 is the brand name of the Association of Business Recovery Professionals, which specialises in helping with insolvencies.
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