The arrangement is proposed through an Insolvency Practitioner. Once an agreement is reached with the creditors, the Insolvency Practitioner distributes the funds. Upon successful completion at the end of the five years, any outstanding debt is cleared.

The cycle of debt is broken when you enter into an IVA as all interest and charges are frozen.

According to market analysis by RSM Tenon the average age of an IVA applicant is 42 and the average amount of debt they’re in a worryingly high £44,700.

Over six hundered cases were looked at during RSM Tenon’s analysis of the market. The study showed that men are 10% more likely to struggle with debt than women.

Middle-aged men are the most likely group to enter into an Individual Voluntary Arrangement. It estimates that around 28% of the 106,000 people declared bankrupt or insolvent in 2008 were men aged between 40 and 45.

London and the South East are the areas where the most IVA applicants come from; with 25% of cases coming from these regions. The Midlands (18.5%) and the North West (15.5%) follow close behind. These three regions are where the majority of IVAs are taken out.

Article Added Tuesday, 27 April 2010 | 5103 Hits

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