If you are struggling with a huge debt, you may be considering an ecured loan IVA. If you have been turned down for credit elsewhere, the IVA process may be the solution you need. A typical IVA involves getting 75% of your creditors to agree to a repayment plan. This can be challenging, because creditors usually haggle over the terms. They may want more money than they have available, or they may want to include some of your assets in the repayment plan.
An IVA is a great way to get out of debt and rebuild your credit rating. It will help you avoid repossession of your property and will prevent your creditors from suing you in the future. Unsecured creditors, however, are not bound by an IVA and are still free to pursue you through legal means. However, if you choose to enter an IVA, you can apply for an Interim Order, which will prevent your creditors from continuing with legal action until you have a Creditors’ Meeting.
Another benefit of an IVA is that you can still get a loan through the IVA, even if your credit is bad. While traditional lenders will reject your application, specialised lenders will give you a chance, but they may only be available through a lending adviser or broker who has access to the whole market. Depending on your circumstances, an early settlement of your IVA can free you from its restrictions and allow you to rebuild your credit.
Both IVA and bankruptcy require the approval of your creditors. You will have an IP draw up a proposal for the creditors to consider, which they will vote on. You may be able to retain your home during the IVA, but you will need to check your tenancy agreement as landlords may not want to let you leave if you are up to date on your rent. If your ecured loan is a substantial asset, you can still use an IVA to protect it from creditors.
Secured loans are typically secured against your home. This means that if you fall behind on your monthly payments, your creditor could take your home. This means that you may find it difficult to access credit options and loans. If you do decide to use an IVA, you should try to pay off the loan early and inform the IP of your decision. You can also arrange a variation meeting if you believe your offer is reasonable and likely to be accepted. Variation meetings are usually proposed when the original terms of an agreement need to be changed.
An IVA can help you with your unsecured debt as well. If you have three or more lenders and a large amount of unsecured debt, you may be eligible for a plan called an Individual Voluntary Arrangement. It involves meeting your creditors and getting them to agree to your plan. It may be the best option if you have a large amount of unsecured debt. For more information, contact an insolvency practitioner.