Innovative Ways to Avoid Bankruptcy

Although greater numbers of people than ever before are taking advantage of Individual Voluntary Arrangements to avoid bankruptcy, it is unfortunate that a good portion of the population still get an IVA confused with a debt management plan. Unlike a debt management plan, an IVA must be overseen by an Insolvency Practitioner and is legally binding because it is drawn up before the courts.

This is one of the most innovative ways to avoid bankruptcy as long as the consumer sticks to the plan laid out in the IVA. After meeting with an IP, a repayment plan is drawn up and creditors are called to a meeting. At this meeting the creditors are allowed to vote and if even one votes yes it is agreed upon. Unfortunately, if one votes against the plan another meeting will need to be scheduled with more creditors in attendance.

Last year, in just the third quarter alone, there were 13,048 IVAs which was down 31.2% from the year before in the same quarter. More and more Britons are seeking innovative debt solutions that can help them avoid bankruptcy whilst protecting their credit rating at the same time. The key point to remember here is that not only does an IVA help circumvent being bankrupt but it also keeps your creditors from taking any legal actions against you as long as you continue to make your repayments.

Because of all the benefits an IVA can provide, Insolvency Practitioners such as debtfreeme are finding that many Britons are able to maintain a better credit rating whilst avoiding bankruptcy. Even though being bankrupt no longer carries the stigma that it once did, there are so many legal and financial ramifications which should be avoided at all costs. Speak with an IP at Debt Free Me to find innovative ways to avoid bankruptcy.