Tackling Debt in 2025: Navigating the Challenging Cost of Living in the UK

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Can I get an IVA? If you’re struggling with debt, you may be wondering if an Individual Voluntary Arrangement (IVA) is an option for you. In this article, we’ll explore what an IVA is, who can get one, and what the benefits and drawbacks are.

What is an IVA?

An IVA is a legally binding agreement between you and your creditors to repay your debts over a fixed period, usually five years. It’s a form of insolvency that allows you to pay off your debts at an affordable rate, while also protecting you from legal action by your creditors.

Can I get an IVA?

To qualify for an IVA, you need to have at least £6,000 of unsecured debt and be able to make regular payments towards it. You also need to have a regular income and be able to afford the monthly payments required by the IVA.

How to apply for an IVA

advantages and disadvantages of an IVA

One of the main benefits of an IVA is that it allows you to pay off your debts at an affordable rate. Your monthly payments are based on what you can afford, so you won’t have to worry about paying more than you can afford.

Another benefit of an IVA is that it protects you from legal action by your creditors. Once your IVA is approved, your creditors can’t take any further action against you, such as applying for a County Court Judgment (CCJ) or bankruptcy.

Drawbacks (Can I get an IVA?)

One of the drawbacks of an IVA is that it can affect your credit rating. When you enter into an IVA, it will be recorded on your credit file, and this can make it harder to get credit in the future.

Another drawback of an IVA is that it can be a long-term commitment. Most IVAs last for five years, so you’ll need to be prepared to make regular payments for this length of time.

Conclusion (Can get an IVA?)

If you’re struggling with debt, an IVA can be a good option for you. It allows you to pay off your debts at an affordable rate and protects you from legal action by your creditors. However, it’s important to remember that an IVA can affect your credit rating and can be a long-term commitment.

If you’re considering an IVA, it’s important to seek advice from a qualified debt advisor. They can help you understand if an IVA is the right option for you and guide you through the process.

If you’re considering an IVA, it’s important to understand the process involved. Firstly, you’ll need to find a licensed Insolvency Practitioner (IP) who will assess your financial situation and determine whether an IVA is the right option for you. They will also help you to draw up a proposal for your creditors, which will outline how much you can afford to pay each month and how long the IVA will last.

Once the proposal is complete, it will be sent to your creditors for their approval. If 75% of your creditors (by value of debt) agree to the proposal, it will become legally binding on all of your creditors, including any who didn’t vote. You’ll then make regular payments to the IP, who will distribute the funds to your creditors.

Can I get an IVA Duration Process?

During the IVA, you’ll be subject to certain restrictions, such as not being able to take on further credit without the IP’s permission. You’ll also need to provide the IP with regular updates on your financial situation.

If you’re unable to keep up with the payments, the IVA may fail, and your creditors could take legal action against you. It’s therefore important to make sure you can afford the monthly payments before entering into an IVA.

In conclusion, an IVA can be a good option for those struggling with debt, as it allows you to repay your debts at an affordable rate and provides protection from legal action by your creditors. However, it’s important to understand the process involved and to seek advice from a qualified debt advisor before making any decisions.

You can get free independent advice from https://www.moneyhelper.org.uk/en

Cost of Living Help or living crisis remains a pressing concern for many individuals and families across the UK. Escalating expenses for essentials such as housing, healthcare, and education have made it increasingly challenging to make ends meet. This issue is particularly acute in urban areas, where the cost of living is significantly higher compared to rural regions.

The Rising Burden of Debt

One of the most significant factors exacerbating the cost of living crisis is the increasing amount of debt that people are accumulating. Whether it’s credit card debt, medical bills, or student loans, the weight of owing money can be overwhelming. This financial strain makes it difficult for individuals to afford even the basic necessities of daily life, trapping many in a cycle of debt that is hard to escape.

Swift Debt Help: Debt Management

Swift Debt Help, a UK-based company, offers comprehensive solutions for those struggling with debt. One of the primary services provided is the Individual Voluntary Arrangement (IVA). An IVA is a legally binding agreement between an individual and their creditors, allowing the debtor to pay off their debts over a set period, typically five years, with the assistance of a licensed insolvency practitioner.

Benefits of an IVA

1. Debt Reduction

One of the key advantages of an IVA is the potential to reduce the total amount of debt owed. Through a process known as “debt reduction,” a portion of the debt can be written off by creditors, making the remaining debt more manageable. This reduction helps individuals allocate their finances towards essential living expenses without the constant pressure of mounting debt.

2. Financial Stability and Peace of Mind for Cost of Living Help

An IVA provides a clear and structured plan for debt repayment, offering individuals a sense of financial stability. With an IVA in place, debtors are protected from further legal actions by creditors, including harassment and court proceedings. This protection allows individuals to focus on rebuilding their financial health without the added stress of creditor pressures.

3. Halting Interest and Charges

Another significant benefit of an IVA is the cessation of interest and additional charges on existing debts. By stopping these accruals, individuals can concentrate on paying down the principal balance, accelerating their journey toward financial freedom.

4. Legal Protection

Once an IVA is approved, it offers legal safeguards against creditor actions such as bailiffs, county court judgments (CCJs), and statutory demands. This legal protection remains in effect for the duration of the IVA, ensuring that individuals can work towards debt repayment without fear of further legal complications.

5. Transparency and Accountability

The IVA process ensures a high level of transparency and accountability. Individuals receive a detailed overview of their debt and the agreed-upon payment plan, helping them stay on track with their repayments. This clarity is crucial for maintaining financial discipline and achieving long-term financial stability.

Eligibility and the IVA Process

It’s important to note that an IVA is not suitable for everyone. To qualify, individuals must meet specific criteria, including having a minimum level of unsecured debt and the ability to make regular payments towards their debt. Additionally, IVAs are available to residents of England, Wales, and Northern Ireland.

The IVA process involves several steps:

1. Initial Consultation: A certified Insolvency Practitioner (IP) assesses your financial situation to determine if an IVA is the right solution for you.
2. Proposal Development: The IP drafts a repayment plan based on your financial capacity, outlining the amount you can afford to pay each month and the duration of the IVA.
3. Creditors’ Approval: The proposal is presented to your creditors, and approval is typically required from at least 75% (by value) of those who vote on the proposal.
4. Implementation and Management: Once approved, the IVA becomes legally binding. You make regular payments to the Insolvency Practitioner, who distributes the funds to your creditors.
5. Completion: Successfully completing the IVA results in the legal write-off of any remaining unsecured debts included in the arrangement, allowing you to move forward with a cleaner financial slate.

Exploring All Debt Solutions

Cost of Living Help with an IVA offers numerous benefits, it’s essential to consider all available debt solutions to determine the best fit for your unique circumstances. Swift Debt Help provides expert advice on various options, ensuring you receive tailored guidance to regain control of your finances, cost of living help is available.

Take the Next Step

If you’re struggling with debt amidst the rising cost of living, it’s crucial to explore your options and seek professional advice. Take our Solution Provider Test to quickly assess your situation and discover the most effective strategy to manage your debt and achieve financial stability.

for more details on the matter you can visit help with debt for more details on the solutions we can assist with for Cost of Living Help.

Are you struggling with multiple debts? There are many debt solutions available, so, depending on your circumstance and financial situation, there will be one that is right for you. For example, a Debt Relief Order (DRO) may be an option to consider.

What Is A Debt Relief Order?

A Debt Relief Order is a form of insolvency that is only available in England, Wales and Northern Ireland. It is an alternative to going bankrupt and instead writes off the debt you are unable to pay off in a reasonable amount of time. Debt Relief Orders have been designed to provide relief to people who have borrowed money, allowing them to try and improve their financial situation.

To meet the Debt Relief Order criteria in England and Wales, your total debt needs to be below £30,000 and you only have £75 or less per month as spare income after paying for reasonable or essential living expenses. Also, this must be your only Debt Relief Order in the last 6 years, and your assets must be worth £2000 or less. You must have lived or worked in England or Wales in the last 3 years.

If you are accepted for a Debt Relief Order, your name will be placed on a register called the Individual Insolvency Register, and it will remain there for the length of your DRO, plus an additional three months.

Not all debt can be included in a Debt Relief Order. For example, student loans and criminal fines are not included. The ones that can are called qualifying debts.

How Long Does A Debt Relief Order Last For?

When you have a Debt Relief Order, you can get your debt written off after 12 months if your financial situation remains the same in that time period and you continue to meet the qualifying criteria.

The Official Receiver, an officer of the Insolvency Service, is the one who accepts your application, and they may extend your DRO or end it early, depending on the circumstances. Most DROs last for 12 months.

After those 12 months, your debt will be written off.

8 Debts To Include In A DRO:

1) Utilities and Council Tax Arrears

A Debt Relief Order can help with household arrears, which include the likes of council tax, gas, electricity, rent and telephone bills. Council tax debts in particular are important debts to deal with as non-payment of these can have serious consequences such as imprisonment. 

Debt Relief Orders are one way of clearing council tax debt. Council tax going forward will need to be paid as normal.

2) Credit Card Debt

Credit card debts are common in the UK, with the average citizen having £2718 credit card debt in 2020, and as of April 2022, it is approximately £7264 per household. April 2022 has also seen the unsecured debt per adult increase to £3817. 
Using a credit card is similar to taking out a loan, and paying off credit card debt is important to prevent the amount of interest from the loan from building up into something unmanageable.

3) Payday Loans

Payday loans are small amounts of money that are lent between paydays, usually between £50 and £1000, and last for a few weeks. They are well known for having high interest rates and small windows in which the money can be paid back.

This style of loan often leaves people struggling to pay the loans back, and can make their financial situation worse. This is especially likely if you are already in financial difficulty when taking out a payday loan.

Having a DRO offers relief for your payday loan debt and can be written off at the end of the process.

4) Overdrafts

Overdraft debt often comes with high-interest rates, and can sometimes feel like the money is your own instead of borrowed. If you have a current account with the bank you owe money to, they may take money from said account to pay themselves back that overdraft debt you owe. 

A Debt Relief Order allows your overdraft debt to be written off at the end of the DRO.

5) Benefit Overpayments

Benefit overpayments are when you have been paid more than you are entitled to in benefits. It can be easy to struggle to pay back benefit overpayments, especially if the money has already been spent before realising it was an overpayment.

Benefit overpayments that are included in your DRO cannot be recovered.

Unless they are a result of fraud, benefit overpayments can be written off.

6) Hire Purchase or Conditional Sales Agreements

Hire purchases and conditional sales agreement items do not legally belong to you until they are paid off fully. If you have paid less than 33% of your hire purchase agreement debt and you miss payments, you may have to return these items if you have a DRO. Transferring the ownership of these items to someone who can pay for them may also be an option.

In certain situations, you may be able to not have this included in your DRO if you are not in arrears with your payments. Speak with your Official Receiver about whether you need to include your hire purchase or conditional sales agreement in your Debt Relief Order.

You cannot have a hire purchase or a conditional sales agreement if you do not make them aware that you have a Debt Relief Order.

7) Finance Items

Some items, such as washing machines, can be bought on finance, which includes Buy Now, Pay Later (BNPL) purchases. These are short-term finance options where customers can make a purchase and pay for it at a later date.

Buy Now, Pay Later debts can have interest attached, although sometimes that interest only comes into place after a specific amount of time. Some BNPL debts can be interest-free. Whilst they don’t impact your credit score at the time of writing, they may in the future, and having Buy Now, Pay Later debts combined with other debts can still impact you financially.

Depending upon the nature of the agreement, the money borrowed may be secured on the item purchased. Failure to make the payment could mean that the item is repossessed so ensure you are aware of the terms and conditions of the agreement.

8) Loans From Family Or Friends

Loans from family and friends can also be written off with Debt Relief Orders, however, bear in mind that this means that the person you owe money to will not be repaid.

There are various options that are available for you to use if you are struggling financially, and it is important that you find the right solution for you. If you find you are in need of a solution such as a DRO or an IVA (Individual Voluntary Arrangement), you need to ensure the one you apply for meets your needs, and that you meet the criteria so it can help with your financial situation. At Swift Debt Help we can fully assess your financial situation to see if we can offer a solution that meets your needs.

Are you wondering whether taking out a loan is the right thing to do? Well, before you start applying it is best to consider what types of loans are available so that you can make an informed decision concerning your financial situation. 

There are many types of loans to suit people’s different circumstances. For instance, whilst student loans are commonly heard of, there are also types of loans that can help you pay off existing debt.

 Hopefully, this blog should help you to decide the option that best suits you.

How Do Loans Work?

Each type of loan works differently. Mostly, a loan is a fixed amount of money that a lender offers to you, and the amount that you borrow will have to be paid back in full, usually with interest, over an agreed period.

However, not all loans have interest rates. Additionally, some have variable rates, so the amount that you pay back each month can vary. On the other hand, a personal asset could be used as collateral, if you fail to pay back what you borrowed.

The different categories of loans are as follows:

Secured Loan 

So, what is a secured loan? 

A secured loan is a type of loan where a personal asset, such as a house, is used as security for the lender. In simpler terms, if you fail to pay back what you have borrowed, then the lender can repossess the asset. 

Generally, it is a property that will be used as collateral, but other valuable items can be used as well, such as a car.

 Unsecured Loan 

Now, what is an unsecured loan?

An unsecured loan is a type of loan where the lender does not require collateral. However, because the lender does not have any security in this instance, they will usually have higher interest rates.

Additionally, to receive an unsecured loan, the borrower would usually need to have a good credit history.

Instalment Loan 

An instalment loan is a type of loan where the borrower repays the lender the full amount of what they owe by instalments over a set period. Typically, the borrower would also have to pay interest. 

Before the loan is approved, usually an amount will be agreed on of what the borrower will have to pay each month as well as the date that it will have to be paid. 

Revolving Credit 

Revolving credit is a type of loan that is flexible. The borrower can make repayments but then withdraw again as long as it is within their pre-approved credit limit. This type of loan tends to be reviewed every 24/36 months to ensure it still suits the borrower’s needs.

The borrower would usually have to pay interest and, with regards to what they have borrowed, there is typically a minimum amount they would have to repay each month.

What Are the Specific Types of Loans?

1) Personal Loan 

Lending taken out by an individual, and not a business would be considered a personal loan.

They can be used for a range of purposes such as home improvements, buying a vehicle or for consolidating multiple, high-interest debts. Often their flexibility and short-term repayment plans can be convenient if you have an unexpected expenditure, such as a high bill. 

Additionally, some people may take out a personal loan to help them with a new business venture.

Personal loans can be secured, but typically they are unsecured, meaning the lender will not require any collateral.

The borrower will usually have to pay interest on a personal loan, either at a fixed rate or variable; the rates you will be offered will depend on your credit history and current financial situation.

Find out how to improve your credit score to get a better interest rate.

2) Hire Purchase 

A Hire Purchase (HP) Agreement is a credit agreement where you hire an item (for example, a car or other high-value item) and pay an agreed amount in monthly payments. You do not own the item until you have made the final payment.

Because the lender has more security with this type of loan (they can seize the car or item if you fail to make your repayments) these lending agreements can often be available to those with a poorer credit history. Rates tend to be lower, the better the credit score that you have. 

The borrower will pay off the loan in fixed monthly instalments. Usually, the loan amount and the interest rate that the borrower will have to pay will depend on the price of the car, the value of the deposit that can be put down and the credit rating of the borrower.

As the Lender has security in the form of the vehicle it can be at risk of repossession if payments are not maintained.

3) Student Loan 

A student loan is a sum of money that a student borrows to help them pay for their higher education, such as for a course at a college or university. They can also help to cover living expenses if a student isn’t earning enough or if they are unemployed. 

A student loan is available from both the government and private lenders and the borrower, and, typically, the borrower doesn’t have to start repaying it until they are earning a certain amount of money.

The interest rate will vary depending on the type of student loan.

4) Mortgage 

Mortgage loans help a borrower buy a property, typically a house.

A mortgage is a secured loan, meaning that the lender will use your property as collateral (they can seize your property if you fail to make payments).

There will also be an interest rate to pay, which will depend on the credit history and current financial situation of the borrower. Additionally, the deposit amount that the borrower is able to put down will also be an important factor. 

The mortgage loan is repaid by the borrower via monthly instalments over an agreed period.

Some people decide to remortgage to clear the debt that they have accrued. 

5) Debt Consolidation Loan 

A debt consolidation loan is a way for borrowers to repay multiple debts, paying them all off with one bigger loan. This type of loan can be used to pay off multiple types of credit including credit card debt, overdrafts, and personal loans.

Since this allows all of the borrower’s debt to be in one place the interest rate may be lower which could help them to reduce their monthly payments. 

Additionally, a single monthly payment can be easier for a borrower to manage, rather than being responsible for making payments to multiple creditors.

6) Payday Loan 

A payday loan is a short-term loan, usually available on the internet or from high-street shops. 

This type of loan, typically, comes with a high-interest rate and it has to be paid back within a month. If you take out a payday loan, then you will usually have to agree that your lender can take the money that you owe from your bank account.

7) Doorstep Loan 

A doorstep loan (also referred to as home credit) is a type of loan that can help you with an emergency or any short-term costs. 

It is known as a doorstep loan because the lender visits the borrower’s home to give the loan in cash, then returns at a later date to collect the repayments. However, these days there is usually an option to receive the loan and make repayments online.

The amount you can borrow in a doorstep loan is usually up to £1000. They come with high-interest rates since they are typically easy to apply for even if the borrower has a bad credit history.

Find out how to deal with debt collectors at your door.

8) Logbook Loan 

A logbook loan is a secured loan since the lender will use the borrower’s existing car as collateral. 

This is a more expensive type of loan as interest rates are usually very high.

You can normally borrow between £500 – £50,000 depending on the vehicle value and repayments must be made within 78 weeks of you taking out the loan.

Find out more information if you need help with logbook debt.

9) Loan Shark 

A loan shark is a type of lender that is not authorised by the Financial Conduct Authority (FCA). 

This is an illegal type of lender. They charge very high fees and there is hardly any paperwork involved.

If the borrower fails to repay what they owe, then a loan shark will generally use illegal means to try and get the money. 

If you have taken out a loan with a loan shark and they threaten you, then contact the police immediately. You can report a loan shark on the following Government website https://www.gov.uk/report-loan-shark

Find out more about loan shark debt.

Now that you’ve read some information about the different types of loans available, hopefully, you will be able to make an informed decision on the right option for you. However, Swift Debt Help can offer advice regarding other debt solutions, such as an Individual Voluntary Arrangement (IVA).

Debt consolidation is a term used when a person has several debts that they decide to merge into one loan. This is done by taking out a new loan to pay off their original debts. Since all of the debt is in one place the interest rate may be lower which should help to reduce the monthly payments. 

You may not fully understand what debt consolidation is, or you may be unsure whether a debt consolidation loan is the right debt solution for you, which is why we have listed some of the myths that are associated with debt consolidation loans below. 

1. Debt consolidation impacts your chances of credit

Initially, once you’ve applied for a debt consolidation loan, you will see a dip in your credit score; however, this dip should only be temporary.

If you stick to your new monthly payments as well as continue to keep an eye on important factors that affect your credit report, such as ensuring that you’re enrolled on the electoral register, then you should see your credit score begin to increase over time. 

This means that a debt consolidation loan will not affect your chances of successfully applying for new credit or getting a mortgage in the long term.

2. Debt consolidation allows you to pay back less money

Many people find a debt consolidation loan to be an attractive option because obtaining one bigger loan with a reasonable interest rate can work out cheaper in the long run. 

However, before applying for a consolidation loan ensure to calculate what you will pay back in total compared to your current repayment arrangements.

Depending on your existing lines of credit and their interest rates, along with your credit rating, there is a risk that you could potentially only qualify for a loan with a high-interest rate. This means that you could end up paying back more than you would have done in your current situation. That is why it is essential to do the comparison exercise mentioned above.

3. They Result in more debt

A better way to view a consolidation loan is that you are restructuring your existing debts into a new form that works better for you. As detailed above, whether or not you ultimately pay back more or less in total will depend on your circumstances and the loan that you take out. 

You may want to take a consolidation loan that is of a higher interest rate than your existing credit, if it gives you the ability to spread the payments over a longer term to make them more manageable for you on a monthly basis. Some people find that having one payment to make is much more manageable than having to pay many creditors individually. 

4. You’ll save on interest

Usually, creditors will assess your credit report before deciding on a suitable interest rate for you.  

If you have a high credit score, then you may be able to get a good interest rate deal on your new loan. 

However, if you’ve been struggling to pay your creditors, then it’s unlikely that your credit score will be high which means you may be offered a poor interest rate deal.

5. Debt consolidation is a scam 

Debt consolidation is a legitimate solution for those struggling with multiple debts. 

Be wary of any companies that approach you out of the blue, directly offering financial assistance. It is unusual for a reputable lender to approach people directly if you are not already a customer of theirs; or you have not made an application for credit.  

If you are considering consolidating your debts then you should be able to find a reputable lender through comparison websites.

Benefits of a Debt Consolidation Loan:

• All of your debts will be in one place.

• Once the original loans are paid off in full, you will no longer be threatened with legal action by the initial creditors. 

• The debt of your new loan will be repaid through monthly instalments. As it’s only one loan that you’re repaying, the interest rates can be much lower (depending on your credit score), making it more affordable. 

• Simplifies your outgoings, making it easier for you to budget.

Hopefully, this blog will help you to decide whether a debt consolidation loan is right for you; however, if you’ve been declined a Debt Consolidation loan and are struggling to meet the demands of your multiple creditors then submit your details at Swift Debt Help, and we’d be happy to give you a callback to discuss alternative debt solutions.