ClearDebt Comments on IVA decline

Figures issued by the government’s insolvency service today, Friday 3 August 2007, show that whilst the number of consumer insolvencies continues to rise, Individual Voluntary Arrangements – probably the best compromise between debtors and creditors – have fallen by more than 15%, quarter on quarter.

• IVAs down by 15% – quarter on quarter
• Creditors risk debt crisis by not supporting affordable debt resolution

Figures issued by the government’s insolvency service today, Friday 3 August 2007, show that whilst the number of consumer insolvencies continues to rise, Individual Voluntary Arrangements – probably the best compromise between debtors and creditors – have fallen by more than 15%, quarter on quarter.

David Mond, CEO of ClearDebt commented:

“There is no natural reason why IVAs should be decreasing in an economic environment where consumers are finding it more difficult to deal with debt. The credit institutions are denying the over-indebted their right to debt-resolution, in many cases because the IVA companies themselves have made the process too costly for creditors to bear”.

“There will be a debt crisis in this country unless creditors stop trying to dam the flood of people who can no longer afford the credit they have been given. The banks should not frustrate debt resolution schemes that are achievable and affordable – and which represent a debtor’s best efforts. Market forces are driving down IVA fees but yet there is little sign that creditors will stop putting artificial obstacles in the way of consumers who are genuinely trying to deal with their debt”.

– Ends –

For further information please contact:

ClearDebt:
Andrew Smith 0161 244 5433 (mob: 07971 272 483) email: Andrew.smith@cleardebt.co.uk

College Hill Associates:
Paddy Blewer 020 7457 2020 email: paddy.blewer@collegehill.com

Note for Editors:
ClearDebt aims to provide the most transparent and ethical service to debtors, at the lowest cost – giving many more people the opportunity to arrange an IVA than has been possible before. All advisors have been specifically trained in IVA provisions and all have insolvency practice experience.

ClearDebt’s principles include providing appropriate advice wherever possible to all debtors: Where the facts indicate an IVA is the right solution we will provide advice and support – but never pressure – to the debtor. Where the facts indicate other solutions we’ll point the debtor in the right direction.

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