Beware of 'Informal debt consolidation'
Introduction
Money Advice Direct's advisers refers clients seeking debt solutions to a insolvency practitioners and debt management plans providers who are qualified, regulated and accountable. The average person can rely on our advice when considering personal obligations under the 1986 Insolvency Act and any restructuring of businesses.
Recent example of an Individual who entered into 'Informal Debt Consolidation'
Mr Jakes was a taxi driver who lives in the North of England. Mr Jakes had been struggling with credit card debts and personal loans of £16,000. Whilst reading one of the National tabloid newspapers he came across a firm of 'Debt Management Specialists' who Mr Jakes rang in good faith. Within a week Mr Jakes was visited by one of their salesmen. Mr Jakes was advised to pay £250 per month for the next six years and that the first five payments would cover their fee.
Mr Jakes realised something was wrong when he was contacted by one of his creditors who told him that although they had been informed of the offer, they had not agreed to it. He immediately cancelled the arrangement and made a complaint. This method is called an debt management and, although a commonly used procedure, it is not legally binding.
Mr Jakes then contacted the UK Insolvency Helpline. We arranged an IVA for Mr Jakes. His debts were reduced to £9,600 and the interest was halted. Mr Jakes entered into an IVA at £200 per month for four years which was agreed by his Creditors. This affordable monthly solution was based on Mr Jake's disposable income taking into account; rent, living work expenses.
Sole Traders / Partnerships Debt Advice Menu
- Sole Traders and Partnerships enquiry form
- What is an IVA?
- Individual & Personal Insolvency
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- IVAs - Facts and how they work
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- Download IVA questionnaire form
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- Why a loan won't help
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- Beware of informal debt consolidation
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IVA Advice Menu
- IVA (Individual Voluntary Arrangement) Overview
- The IVA procedure
- What is an IVA?
- IVA Enquiry Form
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- IVA - The documentation required
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- Sample IVA proposals for PAYE worker
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IVA's
The IVA Guide
Money Advice Direct has put together an IVA Guide based on the enquiries and questions that we receive at our helpline offices.
In the guide we cover such subjects as IVA Approval, early settlment of your IVA, missed IVA payments, IVA failure, additional debt claims and much more.
[click here for IVA Guide]
What is an IVA?
The IVA is an extremely powerful tool enabling you to clear your debt and return to a clean financial bill of health. Visit Money Advice Direct's Guide to Individual Voluntary Arrangements (IVAs).
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DANGER
Due to the tremendous demand for debt consolidation services the United Kingdom is now overloaded with debt management companies that contain misleading information. [more...]