Debt Advice

If you're struggling with your debts, the right advice can make all the difference. There's no point 'reinventing the wheel' when there are professional debt advisers who've dealt with the issues you're facing many times before.

The first step in sorting out your debts is acknowledging that you need to. The second step is deciding whether you can do it on your own or if you need help.

What kind of debt advice do you need?

Before you can tackle your debts, you need to know how. Doing the wrong thing can easily make matters worse. What do you need to know?

"Which of my debts are the most important?"
"What do I tell my creditors if I can't pay?"
"What happens if I miss a mortgage payment?"

If you need answers to questions like these, you could search the web - or you could ask a professional debt adviser.

Along with answering your specific questions, they can help you help yourself. In many ways, the best kind of debt advice is the kind that teaches you something lasting - like how to budget, for example. Keeping track of the money going into and out of your household will help you:

Spot where you're wasting money.
Figure out if you're entitled to any benefits you're not claiming.
Work out the most effective way of clearing your debts.
Negotiate with your creditors.

Do you need more than debt advice?

Sometimes, the right debt advice is enough to help you sort out your problems, clear your debts and get your finances back on track.

Sometimes, though, you need more than debt advice. However, there are lots of different debt solutions out there, so how do you know which one might be right for you? Just because a particular debt solution has worked (or hasn't worked) for someone you know, that doesn't mean it is (or isn't) right for you.

Everyone's situation is different, but the right debt adviser will have the experience to weigh up your finances and help you explore your options. They'll be able to suggest different ways of tackling your debts and take you through the pros and cons of each possibility.

Depending on your circumstances, they might suggest:

Debt management

If you can't keep up with your debt payments, your lenders might agree to accept lower payments, freeze interest and/or waive charges - although they're not obliged to accept any changes to your repayment terms. You can negotiate with them on your own or you can ask for professional help.

Note: your credit report will show you've not stuck to your original repayment terms. This can make it harder and/or more expensive to obtain further credit for the next 6 years.

Debt consolidation

You could simplify your finances by taking out a new loan to repay all your existing debts in one go. You can also reduce your monthly costs by arranging to repay that loan at a rate you can afford.

Note: repaying any debt more slowly can cost you more in the long run.

IVAs (Individual Voluntary Arrangements)

This is a form of insolvency and a legally binding debt solution. If it's accepted by enough of your lenders, you'll spend (in most cases) 5 years paying what you can afford - and they'll write off any outstanding unsecured debt at the end.

Note: this will damage your credit report for 6 years, making it harder and/or more expensive to obtain credit. Homeowners may be required to release the equity in their property.