Debt forum threatens legal action over IVA charges
by Gill Montia
The Debt Resolution Forum (DRF), which exists to represent advisors and companies within the debt management industry, has accused High Street lenders of preventing thousands of families struggling with their finances from accessing debt settlements.
The Forum, which represents 28 firms, including ClearDebt and Accuma, believes that lenders are imposing artificial barriers on those who could use Individual Voluntary Arrangements (IVAs) as a way of avoiding bankruptcy.
As a result, it is considering a legal challenge to recent changes in the fees imposed by the Insolvency Exchange, which represents leading lenders such as HBOS.
DRF claims that the new charging structure could make many IVAs unviable and drive debt advisors out of business.
Should this happen, a sharp increase in the number of bankruptcies is likely to result.
The Insolvency Service, which is part of the Department for Business and Enterprise, has already publicly stated that many creditors are refusing to make use of IVAs, if the fee is above a certain level.
Meanwhile, the banks are taking the view that IVA providers are selling IVAs as a means by which debtors can get out of their obligations.
Discuss this in the Finance Markets forums
Story link: Debt forum threatens legal action over IVA charges
Add to Bookmarks:
Related financial stories to: Debt forum threatens legal action over IVA charges
- Legal action threatened on IVA charges
- Northern Rock shareholder threatens legal action
- Pension losses result in legal action
- Shareholders of Northern Rock proceed with legal action
- Brazil threatens action over AIDS drugs
- A helping hand for those in debt
- Libor rate rise threatens banking system
- Internet gambling plunging people into debt
- Borrowers race for cash, personal debt soars
- Insurer of the year - Legal & General
Previous: « Arc expands into Ireland with AXA deal
Next: Direct debit inflates car insurance premiums »
Visited 1426 times, 5 so far today
