IVAs across the UK

An IVA (Individual Voluntary Arrangement) is a form of insolvency which can help people in some parts of the UK reduce their monthly expenses and write off the portion of their debt that they can`t realistically expect to repay in a reasonable period of time.

IVAs may be available to people in England, Wales and Northern Ireland - people who live in Scotland are not eligible for an IVA, but may be able to enter a Trust Deed (the Scottish equivalent).

IVAs and Trust Deeds – similarities

In some ways, IVAs and Trust Deeds are very similar.

IVAs and Trust Deeds are, in most cases, only available to borrowers who owe money to three or more unsecured lenders. They`re also only suitable for people who can`t keep up with their monthly payments to those creditors - but who can commit to making regular, smaller payments for the duration of the IVA / Trust Deed.

They also deliver similar benefits. First of all, IVAs and Trust Deeds both allow individuals to write off a portion of their debt once they`ve repaid a certain amount of the money they owe - at a rate they can realistically afford. While they`re in progress, both IVAs and Trust Deeds will protect the individual in question from legal action by their lenders.

Finally, IVAs and Trust Deeds are both forms of insolvency and are, in many cases, seen as preferable to bankruptcy / sequestration (the Scottish equivalent of bankruptcy). They can help not just the borrowers but also the lenders - who can expect to receive more of the money they`re owed than they would receive through bankruptcy / sequestration.

IVAs and Trust Deeds – differences

In some ways, however, IVAs and Trust Deeds are very different forms of insolvency.

First of all, there`s the geographical difference. IVAs are only available to residents of England, Wales and Northern Ireland, while Trust Deeds are only available to people who live in Scotland.

Second, IVAs are suitable for people who owe £15,000 or more in unsecured debts; Trust Deeds are for people whose unsecured debts total £10,000 or more.

The third significant difference is the term: IVAs normally last five years, while Trust Deeds normally last for three.

Please note that any form of insolvency is a serious matter and should never be seriously considered without a good understanding of the consequences. For an in-depth look at the pros and cons of IVAs and Trust Deeds, click on a link.

Tags: iva, uk, debt, iva uk, trust deeds, trust deed, scotland, scotland debt, scotland debt solutions, scottish debt management

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