Are IVA’s Causing a Drop in Repossession Rates?
Failure to address the problem of mounting debt can have serious ramifications. Quite simply, the earlier you attend to debt problems, either by making an approach to your creditors directly or seeking out help from a specialist debt advisor, the greater the likely hood of come to a mutually beneficial conclusion. If you choose to ignore your growing debt, you run a severe risk of bankruptcy and with it, the possibility that your assets will be seized to pay off your creditors. This will, of course, include your home. There is simply no escaping the threat of repossession once you allow your debt problem to reach the level where creditors will be pushing for bankruptcy. The only way to try and avoid this happening is to face up to the debt and get help, the sooner the better.
An Individual Voluntary Arrangement, or IVA, is a favourable alternative to bankruptcy proceedings as it will greatly reduce the threat to your assets. The IVA, although it might mean giving up some of the equity, will allow you to keep your house. It would seem that this is having a really positive impact on the number of UK repossessions. Originally, the Council of Mortgage Lenders projected the number of repossessions to reach 75,000 during 2009. It projection was then reduced to 65,000 by June. This wasn’t the end though. Now at 48,000 repossessions in 2009, the latest figure released by the Council of Mortgage Lenders is a massive 35% less than their original estimate.
This could potentially be put down to more restraint being shown by borrowers, more conscientious lending habits or even the government maintaining the low rate of interest. However, it has interestingly coincided with a definitive increase in the number of people in the UK that have applied for an IVA. The government’s Insolvency Service has released figures showing that the number of Individual Voluntary Arrangements has increased by over a fifth in the third quarter of 2009, compared with the same period last year. In that three month period alone, there were 12,390 IVA applications. The pattern emerging seems to point to a direct relationship between a drop in repossessions and an increase in the number of borrowers entering into an Individual Voluntary Arrangement.
If you make contact with your mortgage lender early, advising them of your circumstances, there’s a good chance they’ll make every effort to accommodate a revised repayment schedule. You should also get some specialist debt advice and strive to do so in enough time to avoid bankruptcy proceedings. If you can enter into an IVA, you’ll be able to safeguard your assets and reduce your total debt by up to 75%. There is the added benefit of avoiding the stigma of bankruptcy too, as insolvency proceedings are published in your local paper. If you’re facing the threat of bankruptcy, you’re facing the threat of repossession. Help safeguard your home with an IVA. Talk to a specialist debt advisor at DebtSolver.
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