Consumers ’should consider full debt management options’
Those who are struggling to make loan repayments should avoid taking out an individual voluntary arrangement (IVA), an industry expert has warned.
According to David Kuo, head of personal finance at the Motley Fool, despite the rising popularity of IVAs that they are often not the best option for those struggling with debt management.
He said: "Debtors should always consider their options if they can’t cope."
Mr Kuo suggested that borrowers should consider modifying their spending habits or creating "informal debt management plans" before filing for insolvency which he claimed should be seen "as a last resort".
He also pointed that IVAs are not an "easy solution" as they cost money to implement which could go towards making Personal loan repayments.
Last week, a study by the Insolvency Service revealed a 23.9 per cent increase in individual insolvencies over the first quarter this year compared to the same period in 2006.
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