If you have taken a debt recently or sometime in your past, then you must know about IVA. It is an agreement between you and your creditor, to pay back the debt, over a decided period of time. IVA is usually flexible according to your needs. However, the flexibility does come at a price as an IVA is expensive and does involve some risks too. Let’s get an insight to it all.
Is IVA Beneficial?
IVA does come with some benefits and they are good enough to make you consider this agreement.
Firstly, IVA is legally binding. This simply means that no matter what, your creditor will have to stick to the agreement. They won’t be able to chase you for the money once the IVA gets into action. It will have to be followed strictly by the creditor.
Secondly, IVA has a time limit and you must pay the debt within that time period. However, the good news about this is that the time limitation is pretty great as it varies from 5-6 years. Thus, you have plenty of time to pay back the debt. Lastly, the creditors mostly accept that you will be paying only a decided part of the debt. However, this is decided beforehand and it does depend on the creditor too, as to whether they agree or not. If you have an old student loan, you should consider Student Loans Settlement Program.
Is IVA the right choice for you?
Is IVA a good choice for you? Is it the best agreement for everyone who takes debt? Well, let’s find out.
If you have taken debts of more than $10,000, then IVA is certainly the right choice for you. Anyone with a debt less than this amount can also get an IVA but considering the fees that you have to pay for it; less debt doesn’t really need this agreement. Smaller debts have better repayment methods and they are quite flexible too. IVA is suitable for people with larger debts.
Secondly, it is good for people who have more than just one creditor. A creditor is the person who lends you money. If you have taken money from two people, then IVA is the right choice for you. Likewise, if you don’t want to deal with your creditor directly, then you can sign this agreement too. If you do everything right, you can even buy a house one through IVA.
Lastly, the most important thing to consider before choosing for IVA is your budget. Do you have enough money to make the monthly payments? If yes, only then sign up for this agreement. If not, then choose other repayment methods.
CONCLUSION
To conclude it all; IVA is not for everyone. If you don’t have a stable and fixed income, then it is best to not opt for this agreement as you have to pay the set amount on a monthly basis to the creditor. It is certainly flexible but the monthly payment cannot be overlooked. Thus, choose wisely, considering the pros and cons of it.
