At present, almost everyone is in debt because of enormous financial responsibilities. If you have become sick of living under debts, then it is the right time for you to think about viable debt solutions. Read the article as I am going to discuss a few strategies to make you go debt-free.
Individual Voluntary Arrangement (IVA)
Under IVA, most of the debt types are covered like store card debts, personal loans, overdrafts, bill arrears, council tax arrears, payday loans, joint debts, credit cards bills, income tax or national insurance arrears, debts to family or friends, tax credit or benefit overpayments, and other outstanding bills. There are certain types of debts, like secured debts that cannot be incorporated in an IVA. Typically, secured debts include mortgages, social fund loans, court fines, hire purchase agreements, student loans, child support arrears, TV license arrears, and debts incurred through fraudulent activities. For an individual voluntary arrangement, you must owe up to £10,000. If you are wondering for how long it will last, then you must know that there is no time limit. But it typically lasts for five years. With the help of an IVA, you can make formal arrangements with your creditors and lenders to receive the lump sum amount and write-off the rest of the arrears. Moreover, repayments can end at a specified date, and you will have to pay the less amount than the actual full amount you owe. If you are running an SME, then going for an IVA can be your best bet for smoothly running your business even in the case of bankruptcy. Find out more about this debt solution.
Debt Management Plan (DMP)
You can use this option to sort out your debts related to credit only. There is no such limit of maximum and a minimum level of debts under DMP. To qualify for free debt management plan (DMP), you need to pay around £5/month to each debt. A DMP allows you to repay your debts in less than a period of 10 years. With the help of a debt management plan, you get to enjoy the fair, convenient, and transparent approaches to distributing debt payments. The financial experts at DMP Company continuously review your plan and deliver regular updates to your creditors. DMP lets you decrease the number of payments under unfortunate events. By using the Standard Financial Statement, the experts of Debt Management Company analyze how much you can easily afford to make payments on a monthly basis. Your Debt Management Company is capable enough to successfully negotiate with your creditors. There are moderate chances that your credit rating will be affected by employing a debt management plan. It is advised to search online and pin down a reliable and free debt management company.
Debt Relief Order (DRO)
You must owe £20,000 or less to avail the DRO option. Not all, but most types of typical debts are covered under the debt relief order. If you are pondering for how long will DRO last, then don’t you worry anymore. With a debt relief order, you will be able to settle most of your debts within 12 months. When you have a DRO, you don’t have to consider making monthly payments. It allows you to settle priority debts, for instance, council taxes and energy debts. No court hearing is mandatory under DRO; you can make a fresh start every year. Once you have a DRO, no creditor is allowed to take further actions against you without having the legal permission. But, in some cases, the official receivers can take strict criminal action against you, in case you have delivered incorrect information.
This is an article provided by our partners’ network. It does not reflect the views or opinions of our editorial team and management.
Founder Dinis Guarda
IntelligentHQ Your New Business Network.
IntelligentHQ is a Business network and an expert source for finance, capital markets and intelligence for thousands of global business professionals, startups, and companies.
We exist at the point of intersection between technology, social media, finance and innovation.
IntelligentHQ leverages innovation and scale of social digital technology, analytics, news and distribution to create an unparalleled, full digital medium and social business network spectrum.
IntelligentHQ is working hard, to become a trusted, and indispensable source of business news and analytics, within financial services and its associated supply chains and ecosystems.