The Consumer Credit Counselling Service (CCCS) has outlined the benefits for indebted Britons of entering an Individual Voluntary Arrangement (IVA).
According to the organisation, IVAs often prove more attractive to consumers than outright bankruptcy because they last for a fixed and specified period of time.
A CCCS spokesperson commented: “The main attraction with IVAs is that it’s a much less severe form of bankruptcy – for example, you won’t lose your house or assets as you would do if you declared yourself bankrupt.
“The other attraction is that it’s a fixed 60-month period and then all your debts are paid off, one of the reasons why IVAs are proving popular.”
However, the spokesperson for the group explained that the IVA industry could be set for a period of restructuring in the wake of the so-called credit squeeze, but noted also that consumer are unlikely to be impacted by these changes.
The second quarter of this year saw close to 26,000 people declare insolvency in England and Wales, according to government figures.