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(PRLEAP.COM) This May, the Department of Trade and Industry found that there were 10,091 bankruptcies in the first quarter of 2005. This represents an increase of 24.5% on the corresponding quarter of last year.

Bankruptcy can leave an individual feeling ashamed, depressed and out of control. Furthermore, for many the stigma of bankruptcy can be too much to bear.
However, there may be an alternative to going bankrupt which can also help people in serious debt to make a fresh start.

The Insolvency Act of 1986 introduced The Individual Voluntary Arrangement (better known as an IVA) as an alternative to bankruptcy.

Clear Start- The UK National Consumer Debt Service, is a market leader in IVA management. It arranges Individual Voluntary Arrangements to help people solve their debt problems and avoid bankruptcy.
The idea behind the introduction of the IVA was to enable people facing financial difficulties to come to a formal agreement with their creditors rather than having to face bankruptcy. If an IVA is agreed between the debtor and creditor:
• Interest on the loan is frozen
• Legal proceedings are stopped
• The overall debt is reduced

An IVA is generally seen as a more favorable option than bankruptcy from both the debtor’s and creditor’s perspective. This is because there are no fees or legal proceeding involved with an IVA, unlike with bankruptcy. Furthermore, from the creditor’s point of view, an IVA offers a greater repayment of the debt than would otherwise be achieved if the debtor were made bankrupt.
The IVA represents both an exciting new opportunity to avoid bankruptcy and to make a fresh start at the same time.

More Info: FCL IVA Information