Bankruptcy Alternatives

In many circumstances government legislation is available to provide an alternative so that your debts can be legally restructured to help you avoid bankruptcy.

Individual Voluntary Arrangement (IVA)

If you owe more than £15,000 in unsecured debts then an IVA is likely to be the best way to consolidate your debts without being made bankrupt.

Our Group of companies is specially authorised to help consumers resolve their debt problems by entering into an IVA. If you want to take advantage of this often called “second chance” government legislation then look at the following benefits

• One affordable monthly payment reduced by as much as 70%
  
• Debts consolidated and reduced by as much as 80% with your creditors permission.
  
• IVA periods from one to 60 months maximum giving you the certainty of a debt freedom date.
  
• All interest and charges automatically stopped.
  
• No more demanding phone calls, letters or court threats.
  
• Keep your home and possessions by avoiding bankruptcy

An Individual Voluntary Arrangement ( IVA ) is a new binding agreement between you and your creditors to make a single affordable monthly payment for a fixed period of time up to a maximum of 60 months.  IVAs are completely private arrangements strictly between you and your creditors. No one else need know about your debt restructure.

Only a Licensed Insolvency Practitioner such as our Group of companies is authorised to complete these arrangements. We would work with you to ensure that you have enough money each month to enjoy a reasonable lifestyle and undertake all the creditor negotiations on your behalf. Once this analysis is complete we will prepare a proposal for your creditors and obtain approval for your IVA.

Once your IVA has been approved you become completely legally protected from your creditors taking further action against you for recovery of the debt. You will be able to finally sit back and relax in the knowledge that you only have to make one affordable payment each month for a maximum period of 60 months. Once you have made you’re final payment, all remaining debt is legally cancelled and you will be completely DEBT FREE.

The most important aspect of applying to enter into an IVA is to know exactly what type of company you are dealing with. There are a very limited number of Insolvency Practices in the UK such as our Group of companies, who are authorized to undertake these IVA agreements. However there are an awful lot of middlemen who normally take an upfront fee from you. Be very careful. Do not sign up with anyone who wants any money from you before your IVA is completed and approved. Do not sign up to Direct Debits or Standing Orders or whatever before your IVA is fully approved.

If you want more information on how an IVA can help you gain complete freedom from debt and consolidate your debt problems then please call us on 0800 043 50 43 or complete our enquiry form and let us advise you properly.

Debt Management or 'Pro Rata'

It is possible to make an informal arrangement with your creditors to avoid bankruptcy but you must be very careful how you set up this debt solution

The term “debt management” can cover a whole array of organisations who manage debts from Citizens Advice through to the Banks themselves. Usually debt management refers to an “informal arrangement” with creditors to reduce the amount paid each month by the debtor.

There are many debt management companies offering these informal arrangements in the UK. There are no restrictions upon who can actually set up such a debt management organisation or what fees they can actually charge to the client. Likewise because such debt management arrangements are informal the creditors do not have to abide by them either; meaning that interest and charges often do continue to be applied and the creditors can take further legal action for payment of the debts.

Ask yourself the following questions

• Am I being charged any upfront fees?
  
• Does the Debt Management Company state it definitely will get interest and charges stopped?
  
• How long will it now take me to pay off my debts?
  
• What is the monthly debt management fee?
  
• What are the Debt Management Companies business credentials?

There are many circumstances where a debt management arrangement may be the most appropriate debt solution to a client’s debt problem. However if you have more than £15,000 debts then an Individual Voluntary Arrangement may be more suitable.

If you are currently in a Debt Management Plan with any company then it may still not be too late to act to get your debt problems resolved in a shorter timescale without any interest and charges being applied.

If you are in any doubt as to which debt option best suits your particular circumstances then Avoid Bankruptcy is able to advise upon AND complete the most appropriate solution upon your behalf.

Contact us now on 0800 043 50 43 or complete the enquiry form for an immediate opinion. It could save you a lot of time and money.

Administration Orders

An Administration Order is approved by a formal Court order which covers your outstanding debts in certain restricted circumstances. Under it you would make a single affordable monthly payment to the Court, who will administer the Order and distribute that money between your creditors until the debts are discharged.

For the duration of the Order no creditor, can take any action against you as you are now fully protected by the Court 
Criteria for approval. Administration Orders only work in very restricted circumstances. You must have;

• Less than £5,000 unsecured debts
• Had at least one County Court Judgment against you
• Owe the money to at least two different creditors. 

How to apply

You will need to obtain the relevant forms from your local County Court. Often your local Citizens Advice Bureau will be able to help you complete the form.

An Administration Order can only cover a single person, and where there are debts with a partner e.g. bank loans and Overdrafts, you will need to include the whole debt. If your partner is also within the criteria for an Administration Order then they must apply separately. 

Default of Administration Order

The Administration Order can be revoked if you do not keep up your agreed payments. However if there are extenuating circumstances then the Court can vary the Order to help alleviate your circumstances.

If you have any specific questions about bankruptcy or its alternatives then fill in the below form. Just enter your query and one of our groups impartial debt advisors will get back to you.