There is a great swathe of individuals who are seriously out of their depth with credit repayments. They are borrowing additional funds just to keep up with the interest charges and getting deeper and deeper into debt. Many of the financially distressed are frightened of the situation they find themselves in.

Although the natural instinct at times like these can be to bury your head in the sand, those who seek help at the earliest opportunity are the ones who will avoid the worst consequences.

If you are drowning in debt, contact a specialist Insolvency Practitioner today to see what help is available. Depending on your particular circumstances, you might be suitable for an IVA (Individual Voluntary Arrangement).

An IVA is a formal insolvency procedure introduced by the Government in 1986. Lenders agree to freeze interest payments on debts in return for a set amount being repaid each month for a term of around five years.

An IVA is available to all individuals who are experiencing difficulty in meeting contractual payments to their unsecured creditors.

Typically unsecured debts should total at least £15,000 and be owed to more than one creditor.

The significant advantage of an IVA is that it gives finality to the crisis, at the end of the IVA period you will be free of debt.  It also carries an element of debt forgiveness with an amount of the debt you owe negotiated away.

By contacting a specialist IVA company you'll get advice on all the options open to you. Trained advisors are there to help you find a solution to your debt problem that best fits your needs, and this sometimes requires a bit of creative thinking.  The solution isn’t always an IVA. If you would be better off going bankrupt, you'll be advised accordingly.

Britain's Debt Crisis

The news that Britain's economy shrank by 0.5% in the third quarter of 2008, after standing still in the second quarter, was confirmation enough for all but the most pedantic of statisticians that Britain is now in its first recession in 17 years.

For most people, the statistical proof was hardly necessary. With food, energy and mortgage costs rising, most families have been feeling worse off over the past few months – and increasing numbers of people are now facing losing their jobs as well, as companies try and cut costs to survive the downturn.

For many people, one of the biggest problems has been managing the debts which they have built up over the past few years. With mortgage and loan rates having risen – in spite of cuts in the Bank of England base rate – increasing numbers of people are now struggling to meet their monthly repayments, and are concerned that they may be facing repossession or a visit from the bailiffs.

There are many reasons why people can no longer keep up with credit repayments that were once affordable: job loss, illness, marital breakdown. The increasing cost of housing is also a big contributory factor as more and more young families over extend themselves to get on the property ladder. It only takes a small interest rate rise and the household finances no longer balance. Once
the credit repayments are no longer affordable the level of borrowing quickly grows as missed and late payment charges mount up. 

Large numbers of people are trying to manage their overwhelming debts through informal debt arrangements. The informal plans offer no debt forgiveness, continue to charge interest, and offer no guaranteed protection from creditors. At any time the creditors can change their mind about a plan and the debtor is back to square one.