The number of people likely to enter into Individual Voluntary Agreements (IVAs) looks set to increase once again in 2017.
Data released by the Insolvency Service revealed that there was a 23.2 per cent increase in the number of IVAs in 2016.
Now new analysis suggests that the trend is likely to continue between now and the end of the year.
In February of this year, the number of IVAs and Trust Deeds recorded was almost 20 per cent higher than the same month in 2016.
If current projections are correct, the total number could rise to 70,000 over the course of the calendar year.
IVAs are a form of insolvency which differs from bankruptcy arrangements in a number of key ways.
An IVA will ordinarily last for five or six years, whereas bankruptcy tends to be discharged after a 12 month period. IVAs require surplus income, whereas bankruptcy does not, and the charges and costs between the two systems also differ.
IVAs have some advantages, including the fact that you may be able to keep some assets and will also retain a measure of control over the initial process.
Bankruptcy, meanwhile, is generally seen as a quicker way to become debt free and you don’t need creditor approval.
Remember that if you are in financial difficulties it is always important to seek expert advice on the insolvency arrangements which will be the best fit for your own personal circumstances.
