The,Individual,Voluntary,Agree finance, share, loan The Individual Voluntary Agreement Market in Focus

Thankfully, there are now several web sites that are there to help people like you with bad credit to find the fast personal loans that you need. When you have bad credit, the first thing that you should be looking for is a loan company that If your financial problems have reached the point where you do not see a way out and you feel as though you are drowning in debt, your best way out is through declaring bankruptcy. Filing may well allow you to get your finances back on track

Introduction Known generally as IVAs, Individual Voluntary Arrangement agreements are getting a lot of press. This article discusses whether they are an genuine alternative to bankruptcy, discusses the advertising and promotion regime and talks about the market players and what the industry and regulators are saying about the IVA market. The IVA Mushroom Recently there has been a huge push in the advertisement of IVAs saying things like "Saddled with debt? Why not write off up to 80% of your debt and completely clear it in three to five years?" These types of advertisement have certainly enticed people. The UK currently has its largest ever debt problem and, at the time of writing, the UK is said to account for one third of all unsecured debt in Europe. Including mortgages, consumer debt has jumped to £1.2 trillion and the popularity of IVAs is soaring as people struggle to cope with debt. The number of organisations dealing in IVAs has soared dramatically and there are now said to be 100 operating in the UK. The largest companies range from AIM listed providers such as Debt Free Direct, Accuma and Debtmatters to smaller organisations such as Freeman Jones, Blair Endersby and Haines Watts. In the year 2002 it is reported that only 5000 IVAs were processed in the UK. The figure is expected to reach 40,000 this year and within the next four years Credit Suisse has predicted it will reach 100,000. The shares in the companies listed on AIM have soared in recent times and the demand for IVAs has reached such epidemic proportions the Consumer Credit Counselling Service (CCCS), a charity funded by the finance industry, is said to be contemplating offering IVAs to compete with the commercial industry. The hope is they will cut out the fees paid to third parties and return more money directly to creditors. The IVA Toadstool? The Banks have become publicly critical of IVA companies, which in most cases receive as big amount of money as the actual creditors when the debts are paid off. It is rumoured that the IVA group First Advice delayed their listing on AIM as a direct consequence of the criticism from the Banks.  While IVAs do offer a number of advantages if someone is facing the likelihood of bankruptcy the advertisements for them have been criticised for being misleading. With the attractive marketing and advertisements people get enticed into dealing with the IVA companies, whereas they should first seek independent free advice from one of the charities like the Citizens Advice Bureau (CAB), Payplan or the CCCS. They will all arrange a repayment plan and help consumers deal with their creditors for free. Industry Critics have accused the IVA market of failing to tell consumers about the pitfalls of IVAs and of only concentrating on the advantages. The most flagrant malpractice is when insolvency practitioners (who are licensed to deal in IVAs) encourage people on very low incomes to consider an IVA when declaring personal bankruptcy would be more appropriate. Another criticism from the Banks is that the IVA company takes most of their fees in the first year leaving the actual people owed money (the creditors) to get there repayments in later years. The problem is that if the IVA plan fails the insolvency practitioner keeps their fee but the client is back to square one still owing the whole amount to the creditors. Whilst still in the early stages, watchdog groups and the Insolvency Practitioners Council (IPC) are set to improve the market in the coming months. The biggest companies are set to adopt a new code (some of it voluntary), which will require companies to adopt a code of practice to give consumers more accurate advice and also make provisions for clients' funds in case of their own insolvency. One of the inherent problems of the IVA market is that the providers have much more financial incentive to sell someone an IVA instead of encouraging them to declare themselves bankrupt or take part in a debt management plan. On top of a fee of about £2,000 for writing up the IVA contract on behalf of the debtor, the IVA groups receive a fee of between £5,000 and £10,000. This is deducted directly from the assets paid by the debtor for the full duration of the IVA, which is usually around five years. Insolvency practitioners would simple receives a flat fee for handling a bankruptcy. In contrast the creditors, who were owed the money in the first place, receives between 25% and 50% of their money back from the IVA providers. In response to this some banks are increasing the minimum amount by way of repayment. One bank recently increased its acceptable percentage from thirty five to forty five per cent. Whilst IVAs do have some downsides for Creditors analysts say if someone is facing bankruptcy the benefits can outweigh the negatives, but they point out that it makes practical sense to take out an IVA only if your debt is around £15,000 to £20,000.