The monthly payments are calculated according to what the debtor can afford to pay. As long as the terms of the arrangement are honoured, the debt is paid off in five years.
(PRWEB) May 14, 2006
The latest personal insolvency statistics make for grim reading but The Debt Help Site insists there is a way out without having to resort to bankruptcy.
According to the Insolvency Service, there were 23,351 individual insolvencies in England and Wales in the first quarter of 2006 on a seasonally adjusted basis. This represents an increase of 12.9% on the previous quarter and an increase of 73.4% on the same period of 2005.
This translated into 15,389 bankruptcies, 12.5% up on the previous quarter and 51.2% up on the corresponding quarter of the previous year.
However, The Debt Help Site is spreading the message that the Individual Voluntary Arrangement, or, IVA, should be considered as an alternative to bankruptcy.
While bankruptcy puts at risk key assets and carries with it strict business and financial restrictions, an IVA allows the insolvent to retain their assets and continue earning while paying off a greatly reduced debt over five years.
Terry Galvin, editor of The Debt Help Site, explains: "As the latest figures show, there is a sharp rise in personal insolvency. An IVA is a solution that can both reduce the debt considerably and also organise the rest into affordable monthly payments.
"An insolvency practitioner draws up a proposal and organises a creditors' meeting where a vote is taken, and if a majority representing 75% or more of the debt is in favour, the IVA can go ahead. This way, a large percentage of the debt can be written off.
"The monthly payments are calculated according to what the debtor can afford to pay. As long as the terms of the arrangement are honoured, the debt is paid off in five years."
Galvin adds: "Of course, the IVA is not for everyone but it should be considered carefully before going into bankruptcy. Anyone concerned about personal insolvency should seek the advice of a professional debt counsellor immediately to find out about all the options available to them."
For more information on personal insolvency, IVAs and bankruptcy, visit: http://www.debthelpsite.net
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