Under the law of unintended consequences, as defined by Robert Merton, where an action or policy is initiated to produce a desired result but actually produces the opposite result, recent changes or creditor backed fee reductions regarding professional compensation for Individual Voluntary Arrangement services will only lead to more complaints and issues surrounding the marketing and delivery of IVAs.

Just in the past week, some IVA firms are starting to fold up and with certainly more to come. What people generally don't appreciate is that the there are tremendous costs involved with finding appropriate candidates for IVAs.

In a perfect world the marketing of Individual Voluntary Arrangements includes many ancillary services that are delivered for free to consumers based on the total income derived from IVAs. These services include many, many hours of free advice, consumer education, general debt education to the public and many other unpaid public benefit services to consumers.

In the United States, as creditors tightened the noose around the necks of Consumer Credit Counseling Service (CCCS) groups, the primary delivers of debt assistance services, the first services to fall by the wayside were the free educational and general debt advice overhead that was no longer supported by the lower fees generated from creditors through the delivery of debt management services.

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