There is a good
and a bad way to do everything - a smarter way and a more foolish way.
A popular way of
dealing with personal debt in recent years has been the Individual Voluntary
Agreement, or IVA. This writes off up to 70% of your debt immediately
and restructures the remainder according to wahat you can afford in
60 monthly payments over 5 years. The scheme is backed by H.M. Government
and your case will be dealt with by a qualified Insolvency Practitioner,
not a salesman paid on commission. During the repayment
time your creditors are not allowed to contact you, or in any way harrass
you.
This is fine. But
why spend 5 years of your life paying off debts that you can write off
completely before then?
A combination of
writing off the debts that you can, because the credit agreements were
improperly drafted, followed by an IVA, is a much more sensible approach.
Firstly, write off those debts which are unenforceable, then use an
IVA to write off a further 60 to 70 percent.
So here's how to
clear your debts in two stages:
1. Challenge the
validity of the original credit agreement by using our services. Research
shows that up to 70% of all credit agreements taken out before 6th April
2007 are unenforceable because they were improperly drafted under the
terms of the Consumer Credit Act 1974.
2. Of those debts
that cannot be written off (because they are still enforceable under
the 1974 Act), take out a structured Debt Management Plan or IVA with
a qualified Insolvency Practitioner. Again, this can cut off about 70%
of the total sum owed. But, by preceding this with Stage One, that total
amount has been significantly reduced.
There are other
options as well, apart from the above. But the above two stage plan
will suit most people.
Also it should be
noted that an IVA will not be proposed by an Insolvency Practitioner
unless there is at least £15,000 of debt and (usually) payments
of at least £150 to £200 a month may be advanced.
Other individual
cases may be better suited to other specific courses of action, including
bankruptcy as a last resort. Actually bankruptcy isn't such a bad option
since recent legislation, especially if you do not own property - it
is not the draconian last option that it once was. The government recognises
that personal insolvency is a reality of the times we live in, and so
the ways out of insolvency have been made much easier and more varied
than before.
Our legal team will
be able to discuss all the options with you to see which one is the
best suited to your own circumstances.
NOTE: We do not
recommend a "debt consolidation loan". These only increase
the burden of debt that you already have and can serve no purpose in
getting you out of your debt situation, except in rare circumstances
where you are certain that you can meet the repayments and that these
repayments are very much lower in terms of APR than what you are paying
at present. These instances can happen, but they are very rare during
times when times are hard.
In order to see
how the two stage process works in practice, there are some working
examples of how this might work for you on the next page. Clearing
Your Debts In Two Stages - Examples.
How to clear your
debts in two stages.