Pros and cons of using informal arrangements

4 June 2014

Informal arrangements are made informally between a debtor and creditor. These arrangements do not involve the use of formal (legally binding) processes, like court judgements, IVA’s or bankruptcies for example.

When considering informal arrangements – such as dealing with HMRC, negotiating with aggressive creditors, or debt recovery solutions – you should know the pros and cons.

A major benefit of informal arrangements is that the debtor can represent himself/herself and negotiate a settlement/payment plan, face to face with creditors or we can act for you.

The disadvantage is that informal arrangements are not legally binding and can be set aside at any time by the creditor – perhaps due to impatience, a change of circumstances or management, and in some cases, pure bloody mindedness.

However, once an agreement is made and kept to, it is very rare for that to be changed.

We’re here to help. Act now, talk to us about using informal arrangements and get professional advice for free from 4Squared.

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