1 Stop Debt Solutions
IVA Pros & Cons
IVA Pros
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IVAs can be used to write off significant amounts of debt
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The monthly payments are affordable
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You are protected from legal action
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Your creditors can’t contact you directly
IVA Cons
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An IVA will impact your credit score
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Creditors are under no obligation to agree to an IVA request
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Only unsecured debts are included. Any other debts will remain outstanding
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IVAs are recorded on a public register
Debt Management Plan Pros & Cons
DMP Pros
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Reduced monthly repayments
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Creditors can freeze interest and charges on your debts
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DMPs aren’t recorded on a public register
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You should receive less contact from your creditors
DMP Cons
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You’re still liable for your full debt
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Creditors can still take legal action
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There are no guarantees that the creditors will accept offers
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Your creditors aren’t obligated to cease contact
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Can affect credit file
Protected Trust Deed Pros and Cons
Only available to Scottish residents.
PTD Pros
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Potential to write-off some of your debt once your 4-year repayment plan is complete
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Affordable monthly payments that fit your budget and allow you to stay ahead of your debts
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Any legal actions taken against you regarding debt recovery will stop, including bailiffs (Sheriff’s Officers)
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Interest and charges are frozen
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Assets, such as your home, will be protected
PTD Cons
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A legally binding contract
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Creditors can object to your Trust Deed. If multiple creditors object, your Trust Deed may fail to meet its protected status
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Student loans are not included
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Your credit rating will be affected
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You may have to release some of the equity in your property for the benefit of your creditors
Debt Relief Order Pros & Cons
DRO Pros
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Potential to write off debts
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12 months respite from your debt repayments
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Creditors cannot contact you during the 12 months
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You don’t need to appear in court
DRO Cons
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You will need to pay a £90 fee
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Not available if you own property
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Your credit rating will be affected
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Must have less than £2,000 in assets and a car worth no more than £4,000
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Only available if you owe less than £50,000 (£20,000 in Northern Ireland)
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Have less than £75 in surplus income per month after paying your household bills and living costs
Bankruptcy Pros and Cons
Bankruptcy Pros
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Wipes away all unsecured debts, allowing you to start over
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Stops creditors from taking legal action
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You will be left with enough money after repayments to live on
Bankruptcy Cons
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Your possessions, such as your car and house, may be repossessed
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There is an initial fee to pay
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Your bankruptcy will be placed on a public record in the Bankruptcy Insolvency Register
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Your credit rating will be negatively impacted for 6 years
Debt Arrangement Scheme Pros and Cons
Only available to Scottish residents.
DAS Pros
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A guarantee of legal protection against creditors and interest and charges will be frozen
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Your possessions and property remain safe, regardless of equity value
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Creditors who initially reject your proposal can be forced by an administrator to comply if the arrangement is deemed fair
DAS Cons
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Limited access to future credit
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Credit score will be affected
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Will need to make regular payments