It’s a situation that none of us wish to find ourselves in, but with the country’s economy only just beginning to get back on its feet, people up and down the country of all financial backgrounds are still feeling the effects of the credit crunch.
Whether you’re struggling with mounting personal debt or you are a sole trader with creditors persistently chasing you, the good news is, help is available.
Before jumping to any conclusions about your current financial position, you must consider every available option to ensure that the decision you make is the right one for you. Even if your personal debts are seemingly overwhelming, bankruptcy does not have to be your only way out.
In some situations filing for bankruptcy may be the right choice but it does not mean that you no longer have to make payments towards your creditors. In fact, bankruptcy is likely to have serious implications on your future and is a decision that should not be taken lightly.
- Your credit rating is likely to be severely affected
- You will not be able to acquire credit of £500 or more without disclosing your bankruptcy
- You can no longer act as director of a limited company
- Assets such as your home and car could be at risk
So what alternatives are available? Seeking the right advice is the best place to start – for example, you could seek insolvency advice from Wilson Field. A free consultation with a licensed Insolvency Practitioner enables you to take a step back, study your finances, and make an informed decision on the best way for you to regain control.
An Individual Voluntary Arrangement or IVA is a formal agreement with all unsecured creditors that you owe money to. However unlike a (DMP) Debt Management Plan, an IVA is a legally binding agreement, meaning creditors cannot pursue any further legal action. In addition to this, once your proposals are approved, those creditors cannot contact you about payments or change their minds about the payment plan.
Interest and charges will be frozen, and bailiffs will be prevented from calling you. The IVA usually lasts for 5 years and the payments are agreed between you and your creditors
So before throwing in the towel, make sure you seek free Insolvency advice and begin to regain control of your life and your finances.