If you live in Britain’s capital city it’s known for it’s iconic landmarks, but also for being one of the most expensive cities in the world to live. The cost of rent or mortgages is the highest compare to the rest of the UK, so it’s not surprising that debt problems exist for people on low to medium incomes. That’s why from time to time people contact us for London IVA debt help.
As a registered money advice charity we help everybody across the UK struggling financially, but we have experience specifically helping people living in London.
Debt Support Trust can be contacted on 0800 085 0226 in order to discuss your debts.
IVA in London
An IVA is a debt solution which some people are suitable for when they have debt problems and are struggling to meet their repayments. When the debt was originally borrowed the cost of repayment may have been affordable, however changes in financial circumstances can mean it’s become less manageable.
It’s at this case an IVA when living in London could help you avoid bankruptcy and deal with your debts, usually in a 5 year period. The solution is not suitable for everyone, but if you meet the criteria, then it could be the best option. To be applicable for an IVA you must
- Owe at least £8,000
- Stop paying your unsecured debts (credit cards, overdrafts etc) but be able to repay an affordable amount towards the debt solution every month after you pay your rent / mortgage, council tax and other essential liabilities
- Not be able to repay the debt in less than 5 years
Is an IVA the Best Route?
The IVA if you live in London could be the best option if you are struggling to repay your monthly contractual payments to your credit card, overdrafts and personal loans. To be applicable for the IVA you must be able to repay money towards your debt every month. This will be less than your current monthly payments.
If you are unemployed and don’t have any assets (like a house or car) then bankruptcy may be the best option. If you’re not sure whether an IVA in London is the best route for you then seek debt help from a charity. You can call Debt Support Trust on 0800 085 0226 or complete the debt test.
An example of an ideal IVA would be if a person owed £30,000 to the following
5 credit card = £16,000
1 bank loan = £8,000
2 overdrafts = £3,000
2 payday loans = £3,000
The monthly payments are £970 which is too expensive. An affordable amount to repay the debt would be £300 per month. There is no house or car to consider. In an IVA the house and car is safe however equity could be asked to be released if it’s possible.
A £300 per month IVA for 5 years would mean repaying £18,000.
The IVA costs would be subtracted from the money being repaid and whatever is left is offered to the creditors. This means being debt free in 5 years and £12,000 being cleared.