Secured loans can’t be included in an IVA. Although payment on a secured loan is usually included in expenditure calculations, there are some circumstances where it is not possible to pay it off. One example is the repossession of a house, leaving behind an outstanding debt that is unsecured.
Unsecured creditors can’t repossess your property and can still take legal action. That’s why it’s important to keep an eye on their actions. An unsecured creditor can use the full force of the Consumer Credit Act to pursue you, or even file for bankruptcy. In these situations, the IVA Nominee can apply for an Interim Order to prevent them from taking any legal action until the Creditors’ Meeting.
While an IVA doesn’t work in every situation, it can help people who have fallen behind on their repayments. Creditors are not required to accept an IVA, but they are generally more likely to accept it if you can demonstrate that you can pay back the debt in a manageable amount. The process also gives you time to sort out your finances and make more manageable repayments. However, it does come with risks.
An IVA doesn’t get rid of your debt, but it can help you access huge amounts of credit in the future. You can also protect your assets by putting your home or other valuable assets up as security for the debt. In some cases, you can also use a hire purchase agreement to secure a secured loan.
Because an IVA is recorded on your credit file, it can affect your credit rating. Lenders may be hesitant to lend you money because of the history of your IVA. As a result, they will usually charge high interest rates and impose stringent conditions. A good way to find a loan with an IVA is to start looking for credit before the process begins.
Another option is to use a Trust Deed instead of an IVA. This option is available for those who are unable to pay their debts through the traditional method. If you have equity in your home, a Trust Deed can be a better option for you. However, it is important to remember that this option will only work in certain circumstances.
Although an IVA can help you in some cases, it may not be the best solution for you. If you are still struggling to make your payments through your monthly installments, a lump sum payment can be a viable option. However, it is best not to borrow from family members or friends because this will impede the progress of your IVA. This may cause other creditors to feel ill-will toward you, and the IVA may end in failure.
Secured loan IVAs are also possible if your debt is PS10,000 or higher. If you do not meet this amount, you are unlikely to receive approval. Lenders are only motivated to accept an IVA if they can recoup their outlay.