An IVA will stay on your credit report for six years from the date of commencement, which basically means that it will be there for one year after you have finished paying your installments. It is important that you understand all the inns and outs regarding an IVA.
If you are already experiencing financial difficulty then your credit score is more than likely already bad and will just keep on getting worse as the judgements pile up against you. So, if you are already in trouble with your payments, there is no point in worrying whether or not your score is good or bad – it will be bad!
All debt solutions adversely affect your credit score. The only form of debt solutions that will not affect your credit score is when you remortgage your home, which is only possible if you have enough equity available. Debt solutions affect your score because you have rearranged your original payment agreement.
If your financial situation is bad enough to require you to enter into an IVA then getting more credit would just make your credit score worse. It is for this reason that companies do not allow you to be awarded further credit if your financial state is not sound.
Your monthly IVA payments are much lower than the amount you would have had to pay and all the costs of living has been taken into account, which means that you will not need any further credit to get by. There are certain special circumstances where exceptions are made, but the general public will not get any access to any more credit.
It is important for you to deal with your debt problems when you realize that they have become a problem. Running away from your problems will only end up making the situation worse in the long run. If you are not sure whether or not an IVA is the right solution for you, then you should seek the advice of the professionals, who will be able to determine if you do in fact need an IVA.
Having an IVA does mean the end of the world, as you know it. It is just a stepping-stone to a better life and a way to avoid the stresses that come with owing people money when you cannot pay them. Take charge of your life and get the help that you need in order to become financially secure once again.
Guest post by Charlene, a personal finance blogger who has created her own personal finance blog at life-love-money.com/