Individual Voluntary Arrangement Vs. Bankruptcy: Reviewing the basics
Both individual voluntary arrangement (IVA) and bankruptcy are legally-binding choices for formal insolvency. However, both doesn’t have the same impact your assets, career and other aspects, although your name will end up in the insolvency register nonetheless. How IVA and bankruptcy affect your home and other assets depends on several factors. Here is a quick look at some of the basic aspects.
Effects on your assets and career
Individual voluntary arrangement and bankruptcy works differently for different individuals in diverse financial situations. However, you won’t be pushed to sell your home or car in case of IVA, although it is possible that you may have to re-mortgage your home to pay the debts. You may be allowed to keep your car, especially when you need to go to job or have other requirements. In case of bankruptcy, if equity is tied up to your home, you may be forced to sell it, and the same is true for your car. If the car doesn’t hold much value or is too old, it may not be sold.
With that said, bankruptcy does affect the career more adversely than IVA, because companies are often reluctant to hire people with a bankruptcy record. Also, if you are in the financial, real estate or accounting sector, you may not be allowed to handle finances for your client. Another consequence
Check the pros and cons of IVA
IVA may work better for protecting your assets, and it doesn’t affect your career as much. You can work on your credit status later, and for those who have a business, IVA is often seen as a better solution. On the other hand, the procedure is also lengthy and expensive, and in any cases, it will affect your credit rating. For more information on individual voluntary arrangement, you can check here.
Check the pros and cons of bankruptcy
Fairly speaking, bankruptcy is often not a choice and works better for people who don’t have considerable assets to worry about. The process or the bankruptcy order can be completed in just 12 months, so it’s not a lengthy process. on the other side, bankruptcy may mean selling your home, car, and it will impact your career considerably. Your debt will be public.
To know more on bankruptcy and how affects your career, you can check here.
No matter whether you choose bankruptcy or Individual voluntary arrangement, consult professional services before taking the call.