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Why Seek an Alternative to Bankruptcy
Bankruptcy has numerous disadvantages associated with it which means that an alternative should be sought if at all possible.
As well as the social stigma attached to bankruptcy, there are a number of disqualifications attached to it such as:
* People who are declared bankrupt lose their professional and business status
* Bankrupts are not allowed to hold public office
* If you are made bankrupt you have to hand over your valuable assets to the trustee (including your home)
* Future employment prospects are prejudiced by bankruptcy
* Bankrupts cannot form, manage or promote a business without the court's permission
Why an IVA is a Good Alternative to Bankruptcy
An IVA does not have any of the social stigmas, disqualifications or disadvantages associated with bankruptcy. This makes it a good alternative to bankruptcy.
IVAs were actually introduced initially as an alternative to bankruptcy.
They are popular because they offer a good alternative to bankruptcy for both debtors and creditors.
From a creditor's point of view, an IVA is a good alternative to bankruptcy because there are no fees or legal proceeding involved with it.Moreover, an IVA offers a greater repayment of the debt than would possible if the debtor was made bankrupt.
From the debtor's perspective, an IVA is a good alternative to bankruptcy because it lacks stigmas and disqualifications. Plus with an IVA, it is not unusual for up to 80%25 of a debt to be written off.
Who is an IVA Suitable For
An IVA is a suitable alternative to bankruptcy for people with debts over £15,000, multiple creditors and who can afford to re-pay at least £200 a month.
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