Mortgage News

IVA’s: Are they working or is it seen as the easy way out for debtors by their creditors???

It has recently been reported in the national press that some of the major IVA providers in the UK have issued profit warnings, whilst others are looking at diversifying into other related markets.

One of the larger IVA providers, Debtmatters, has seen a distinct drop in the number of IVA cases that it is managing from 700 predicted cases down to an actual figure of only 250 cases per month.

The reasons given for this downturn has been due to IVAs not being accepted by the creditors, more and more creditors are refusing IVAs and are far more likely to accept Debt Management schemes that will write off the interest but not the capital.

This brings a question to those affected, does the IVA legislation work or are the banks going to say no to every application. Is this the banks flexing their muscles to the little man, or is it just a response to the exploitation of a loophole viewed by some as a means of avoiding repaying their debt??