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Unemployment could lead to more IVAs

The number of families who are hitting financial difficulties after one of the family earners has been made redundant is increasing, as the search for jobs is made harder and harder by the influx of young graduates in the job market.

With unemployment hitting record levels this week, it has emerged that more and more families are having to live off one person’s salary, as the other half of the family has lost their job because of the faltering economy.

This massive reduction in household income has seen these families falling further and further into debt, and the number passing the £15,000 mark needed for an IVA is increasing.

Whilst many families find that the interest payments alone are crippling them, an IVA debt management scheme could help them as they will only have to make payments that they can afford, with the income of the second earner added to the calculations as and when they finally find a job.

An IVA, which allows customers to pay off their debts at an affordable rate, over a five-year period, will also see creditors freezing interest at 0%, as well as calling off any CCJs, and bailiffs.

The job market has become more and more busy as each year another batch of freshly qualified graduates enter the market for a job, with so few graduate level positions now available. The number of graduates now shelf stacking for a living is at a record high, and the fall-back option of a job at minimum wage has been taken away for many, who simply cannot get themselves noticed ahead of all of the young people fighting for the jobs.

Whilst an IVA is a last-ditch alternative to bankruptcy, many believe it has saved them financially, and they also allow homeowners to keep their home, something that is not possible when filing for bankruptcy.

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